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Lots of wet panties, male and female, today in anticipation of Michael Cohen’s testimony. Of course, it’s been leaked, full text is here. A few quotes:

I may once again be in a party of one, but I think it’s awfully weak, it’s grasping for stuff rather than conveying it. First, there’s the inevitable Assange link:

In July 2016 [..] Mr. Stone told Mr. Trump that he had just gotten off the phone with Julian Assange and that Mr. Assange told Mr. Stone that, within a couple of days, there would be a massive dump of emails that would damage Hillary Clinton’s campaign. Mr. Trump responded by stating to the effect of “wouldn’t that be great.”

Anything related to Assange, whether from Mueller or Cohen, lacks credibility as long as he can’t defend himself against it. And Trump merely says: wouldn’t that be great? Not exactly the stuff of collusion or conspiracy.

Just as inevitable in smear campaigns: Trump the racist.

Mr. Trump is a racist. The country has seen Mr. Trump court white supremacists and bigots. You have heard him call poorer countries “shitholes.” While we were once driving through a struggling neighborhood in Chicago, he commented that only black people could live that way. And, he told me that black people would never vote for him because they were too stupid.

Calling a country a shithole is not racist. The policies that have created a situation in which many shithole countries are populated by black people stem from many decades of US/Europe policies that predate Trump. The rest is not racist either, if you look closer. Perhaps Trump is a bit racist, like so many Americans. But Cohen’s prepared words don’t show that.

Also: Trump doesn’t tell the full truth about his wealth. But Michael Cohen always has…

It was my experience that Mr. Trump inflated his total assets when it served his purposes, such as trying to be listed among the wealthiest people in Forbes, and deflated his assets to reduce his real estate taxes.

Gee, lock him up. I don’t get it. There’s so much wrong with Trump, but politics and media have singled out Russia collusion, and then failed to prove a thing about it, and now they switch to ‘racist conman’, with the weakest of accusations. I swear, they might as well all be working for the Donald.

Michael Cohen is to accuse Donald Trump of being a “conman” and a “cheat” who had advanced knowledge that a longtime adviser was communicating with WikiLeaks during the 2016 campaign, according to opening testimony he will deliver to Congress on Wednesday. Cohen’s prepared remarks, confirmed by the Guardian, include a series of explosive allegations about the presidential campaign. The president’s former lawyer, who will publicly testify before the House oversight committee on Wednesday, will state that Trump was told by Roger Stone that WikiLeaks would publish emails stolen from the Democratic National Committee and Hillary Clinton’s campaign.

“In July 2016, days before the Democratic convention, I was in Mr Trump’s office when his secretary announced that Roger Stone was on the phone. Mr Trump put Mr Stone on the speakerphone,” Cohen’s opening statement reads. “Mr Stone told Mr Trump that he had just gotten off the phone with Julian Assange and that Mr Assange told Mr Stone that, within a couple of days, there would be a massive dump of emails that would damage Hillary Clinton’s campaign. Mr Trump responded by stating to the effect of ‘wouldn’t that be great.’” The remarkable allegations by Cohen go further than what has been made public thus far by the special counsel investigation into potential collusion between the Trump campaign in Moscow.

Cohen will also suggest his instructions to lie to Congress about a possible Trump Tower deal in Moscow during the 2016 campaign came from the president – albeit not directly. “In conversations we had during the campaign, at the same time I was actively negotiating in Russia for him, he would look me in the eye and tell me there’s no business in Russia and then go out and lie to the American people by saying the same thing,” Cohen will say. “In his way, he was telling me to lie.” “Mr Trump did not directly tell me to lie to Congress. That’s not how he operates,” he will add.

In a dramatic statement to the House of Commons, Mrs May confirmed that she will put her Withdrawal Agreement – including whatever additional assurances she has secured from Brussels – to a “meaningful vote” by March 12. If that fails, MPs will be offered two separate votes the following day – one on a no-deal Brexit, and the other on requesting an extension to the two-year Article 50 negotiation process to delay EU withdrawal beyond March 29. The sequence of votes will be proposed in an amendable motion tabled by the Prime Minister for debate and vote in the Commons on Wednesday. To uproar in the Commons, Mrs May told MPs: “They are commitments I am making as Prime Minister and I will stick by them, as I have previous commitments to make statements and table amendable motions by specific dates.”

Deputy Political Editor for Sky News Beth Rigby tweeted of Mrs May’s speech: “This really is a big shift. “May has finally played her cards and sided with the Europhile wing of her party .. “Vote for her deal (March 12) Vote for no-deal (March 13) Vote for delay (March 14) .. “Only yesterday she refused to even acknowledge there might have to be a delay to Brexit.”

Mrs May has declared a meaningful vote will take place by March 12, where MPs will vote on her Brexit deal. Should this deal not be voted through, on March 13, MPs will then be offered two separate votes by March 13 on whether the UK leaves with no deal or delays Brexit beyond March 29. The delay will then be voted on March 14, when a motion would be brought forward on whether Parliament wishes to seek a short limited extension to Article 50. If the House votes for an extension, this extension will have to be approved by the House with the EU and then necessary legislation will be brought forward to change the exit date.

[..] In her statement to MPs following a Cabinet meeting with senior colleagues at 10 Downing Street, Theresa May said she wanted to set out “three further commitments” to the Commons. She said: “First, we will hold a second meaningful vote by Tuesday, March 12 at the latest. “Second, if the Government has not won a meaningful vote by Tuesday, March 12, then it will – in addition to its obligations to table a neutral amendable motion under Section 13 of the EU Withdrawal Act – table a motion to be voted on by Wednesday March 13 at the latest, asking this House if it supports leaving the EU without a Withdrawal Agreement and a framework for a future relationship on March 29.

“So the United Kingdom will only leave without a deal on March 29 if there is explicit consent in the House for that outcome. “Third, if the House, having rejected the deal negotiated with the EU, then rejects leaving on March 29 without a Withdrawal Agreement and future framework, the Government will on March 14 bring forward a motion on whether Parliament wants to seek a short, limited extension to Article 50.” The Prime Minister also said she still believes she will be able to secure a deal: “I’ve had a real sense from the meetings I’ve had, and the conversations I’ve had in recent days, that we can achieve that deal. “It’s within our grasp to leave with a deal on March 29 and that’s where all of my energies are going to be focused.”

The government has issued a bleak warning over a no-deal Brexit, estimating the UK economy could be 9% weaker in the long run, businesses in Northern Ireland might go bust and food prices will increase. In an official document only published after repeated demands by the former Conservative MP Anna Soubry, the government also revealed it was behind on contingency planning for a third of “critical projects” in relation to business and trade. The latest no-deal notice states:

• The economy would be 6%-9% smaller over the next 15 years than it otherwise might have been, in the event of no deal, in line with Bank of England forecasts. • The flow of goods through Dover would be “very significantly reduced for months”. • With 30% of food coming from the EU, prices are likely to increase and there is a risk that panic buying might create shortages. • Only six of the 40 planned international trade agreements have been signed.

The document was published just hours after Theresa May was forced to promise two key votes, allowing MPs the option to reject no deal and to potentially delay Brexit for a short period, following pressure from remain-minded cabinet ministers. The prime minister set out a timetable that includes a vote on her Brexit deal by 12 March; if that fails, a vote the following day to support no deal, and if that also fails, a vote on 14 March on extending article 50. The delay is likely to further agitate the Tory party’s Eurosceptics, with Brexiter ministers including Andrea Leadsom and Liz Truss expressing their frustration over the issue in cabinet on Tuesday morning. Speaking in the House of Commons on Tuesday, May did not specify the length of any delay, saying only that she would prefer it to be the shortest possible. An extension beyond the end of June would involve the UK taking part in the European parliament elections.

[..] The no-deal notice said customs checks alone could cost businesses £13bn a year and that it was impossible to predict the impact of new tariffs. It said this was partly because the government’s communications to businesses and individuals about the need to prepare for no deal had not been effective. [..] The EU, which would treat the UK as a third country in the event of no deal, could impose tariffs of 70% on beef exports, 45% on lamb and 10% on cars, it said. “This would be compounded by the challenges of even modest reductions in flow at the border.”

The UK government is due to hold emergency talks with industry leaders on Tuesday after discovering that the country doesn’t have the right pallets to continue exporting goods to the European Union if it leaves without a deal next month. Under strict EU rules, pallets – wooden or plastic structures that companies use to transport large volumes of goods – arriving from non-member states must be heat-treated or cleaned to prevent contamination and have specific markings to confirm that they meet standards. Most pallets that British exporters are using do not conform to the rules for non-EU countries, or “third countries,” as EU member states follow a much more relaxed set of regulations.

The Department for Environment, Food, and Rural Affairs last week told business leaders that the UK would not have enough EU-approved pallets for exporting to the continent if it leaves without a withdrawal agreement next month. That means UK companies would be competing for a small number of pallets that meet EU rules, and those that miss out would be forced to wait for new pallets, which could take weeks to be ready. DEFRA has arranged for a conference call on Tuesday morning to discuss the pallet shortage, with 31 days until Brexit day on March 29. “It is the tiny, procedural, mundane-seeming stuff that will absolutely trip people up,” one industry figure briefed by Theresa May’s government told Business Insider, adding that the country was “not even remotely ready” for a no-deal Brexit.

Travelling with Hugo Chavez, I soon understood the threat of Venezuela. At a farming co-operative in Lara state, people waited patiently and with good humor in the heat. Jugs of water and melon juice were passed around. A guitar was played; a woman, Katarina, stood and sang with a husky contralto. “What did her words say?” I asked. “That we are proud,” was the reply. The applause for her merged with the arrival of Chavez. Under one arm he carried a satchel bursting with books. He wore his big red shirt and greeted people by name, stopping to listen. What struck me was his capacity to listen. But now he read. For almost two hours he read into the microphone from the stack of books beside him: Orwell, Dickens, Tolstoy, Zola, Hemingway, Chomsky, Neruda: a page here, a line or two there. People clapped and whistled as he moved from author to author.

Then farmers took the microphone and told him what they knew, and what they needed; one ancient face, carved it seemed from a nearby banyan, made a long, critical speech on the subject of irrigation; Chavez took notes. Wine is grown here, a dark Syrah type grape. “John, John, come up here,” said El Presidente, having watched me fall asleep in the heat and the depths of Oliver Twist. “He likes red wine,” Chavez told the cheering, whistling audience, and presented me with a bottle of “vino de la gente.” My few words in bad Spanish brought whistles and laughter. Watching Chavez with the people, la gente, made sense of a man who promised, on coming to power, that his every move would be subject to the will of the people. In eight years, Chavez won eight elections and referendums: a world record. He was electorally the most popular head of state in the Western Hemisphere, probably in the world.

See? Like Pilger and Chavez, Nomi talks about literature. No space here to do this justice, please go read it. Key point: unlike the poor(er), the rich don’t live off the rewards of labor, but of that of wealth.

In George Orwell’s iconic 1945 novel, Animal Farm, the pigs who gain control in a rebellion against a human farmer eventually impose a dictatorship on the other animals on the basis of a single commandment: “All animals are equal, but some animals are more equal than others.” In terms of the American republic, the modern equivalent would be: “All citizens are equal, but the wealthy are so much more equal than anyone else (and plan to remain that way).” Certainly, inequality is the economic great wall between those with power and those without it. As the animals of Orwell’s farm grew ever less equal, so in the present moment in a country that still claims equal opportunity for its citizens, one in which three Americans now have as much wealth as the bottom half of society (160 million people), you could certainly say that we live in an increasingly Orwellian society.

Or perhaps an increasingly Twainian one. After all, Mark Twain and Charles Dudley Warner wrote a classic 1873 novel that put an unforgettable label on their moment and could do the same for ours. The Gilded Age: A Tale of Today depicted the greed and political corruption of post-Civil War America. Its title caught the spirit of what proved to be a long moment when the uber-rich came to dominate Washington and the rest of America. It was a period saturated with robber barons, professional grifters, and incomprehensibly wealthy banking magnates. (Anything sound familiar?) The main difference between that last century’s gilded moment and this one was that those robber barons built tangible things like railroads.

Today’s equivalent crew of the mega-wealthy build remarkably intangible things like tech and electronic platforms, while a grifter of a president opts for the only new infrastructure in sight, a great wall to nowhere. In Twain’s epoch, the U.S. was emerging from the Civil War. Opportunists were rising from the ashes of the nation’s battered soul. Land speculation, government lobbying, and shady deals soon converged to create an unequal society of the first order (at least until now). Soon after their novel came out, a series of recessions ravaged the country, followed by a 1907 financial panic in New York City caused by a speculator-led copper-market scam.

To fully grasp the nature of inequality in our twenty-first-century gilded age, it’s important to understand the difference between wealth and income and what kinds of inequality stem from each. Simply put, income is how much money you make in terms of paid work or any return on investments or assets (or other things you own that have the potential to change in value). Wealth is simply the gross accumulation of those very assets and any return or appreciation on them. The more wealth you have, the easier it is to have a higher annual income.

Rabo are already predicting a US recession in 2020, which will drag many down with it, and as the OECD now warns that swollen corporate debt piles, which central banks have so encouraged, is of ever lower quality and potentially more dangerous than it was back in 2008. 54% of investment grade bonds are now BBB-rated, up from 30% in 2008. The OECD argues “In the case of a downturn, highly leveraged companies would face difficulties in servicing their debt, which in turn, through higher default rates, may amplify the effects…Any developments in these areas will come at a time when non-financial companies in the next three years will have to pay back or refinance about USD4 trillion worth of corporate bonds. This is close to the total balance sheet of the US Federal Reserve.”

Guess what guys? China is right ahead of you on that curve – which is why it is trying to find another whale to nuke ASAP: things are looking truly ugly given many firms can’t even pay the interest on their debt, let alone the principle. And guess what else? That OECD and China warning sounds like an admission of the Minsky debt dynamic that you might have thought all central banks would have to have learned the lessons of post-GFC. Apparently not, however – because they think they already know everything. As former Fed Chair Yellen mocked yesterday, Trump doesn’t understand what the Fed’s dual mandates of price stability and stable employment are. That might well be true.

But was it the Fed or Trump who publicly called out how dangerous continuous Fed rate hikes are in a debt-laden, Minsky-teetering financial system where the yield curve is still inverted 9bps on 1s-5s even after a pause? I think Yellen will find it was Trump who was right and the Fed who was forced into a humiliating and frankly incongruous policy U-turn. So much expertise! Trump also made a similar intervention over oil prices overnight, and once again they dipped, though are opening up strongly this morning in Asia. [..] easy policy in the UK; ultra-easy policy in China; promises of more easing in Japan; an ECB U-turn to come(?); and the Fed on hold and stopping QT soon at least. And that’s with bullish markets and reasonable global growth – just wait until things head south: if all you have is a nuke, everything looks like a whale.

There are two generalities that can be applied to all asset bubbles: 1. Bubbles inflate for longer and reach higher levels than most pre-bubble analysts expected 2. All bubbles burst, despite mantra-like claims that “this time it’s different” The bubble burst tends to follow a symmetrical reversal of very similar time durations and magnitudes as the initial rise. If the bubble took four years to inflate and rose by X, the retrace tends to take about the same length of time and tends to retrace much or all of X. If we look at the chart of the Case-Shiller Housing Index below, this symmetry is visible in Housing Bubble #1 which skyrocketed from 2003-2007 and burst from 2008-2012.

Housing Bubble #1 wasn’t allowed to fully retrace the bubble, as the Federal Reserve lowered interest rates to near-zero in 2009 and bought $1+ trillion in sketchy mortgage-backed securities (MBS), essentially turning America’s mortgage market into a branch of the central bank and federal agency guarantors of mortgages (Fannie and Freddie, VA, FHA). These unprecedented measures stopped the bubble decline by instantly making millions of people who previously could not qualify for a privately originated mortgage qualified buyers. This vast expansion of the pool of buyers (expanded by a flood of buyers from China and other hot-money locales) drove sales and prices higher for six years (2012-2018).

As noted on the chart below, this suggests the bubble burst will likely run from 2019-2025, give or take a few quarters. The question is: what’s the likely magnitude of the decline? Scenario 1 (blue line) is a symmetrical repeat of Housing Bubble #2: a retrace of the majority of the bubble’s rise but not 100%, which reverses off this somewhat higher base to start Housing Bubble #3. Since the mainstream consensus denies the possibility that Housing Bubble #2 even exists (perish the thought that real estate prices could ever–gasp–drop), they most certainly deny the possibility that prices could retrace much of the gains since 2012.

More realistic analysts would probably agree that if the current slowdown (never say recession, it might cost you your job) gathers momentum, some decline in housing prices is possible. They would likely agree with Scenario 1 that any such decline would be modest and would simply set the stage for an even grander housing bubble #3. But there is a good case for Scenario 2, in which price plummets below the 2012 lows and keeps on going, ultimately retracing the entire housing bubble gains from 2003.

Russia’s state-run energy major Gazprom said its share of sales of natural gas in the European Union has increased to 36.7 percent last year, rising over two percent against 34.2 percent in 2017. “In 2018, according to preliminary data, the share of gas supplies to the EU countries and Turkey has reached an all-time high and totaled 36.7 percent,” the director general of Gazprom Export Elena Burmistrova said at Gazprom’s Investor Day event, taking place in Singapore. Burmistrova added that Gazprom’s gas exports to Europe last year amounted to record 201.8 billion cubic meters, and is expected to significantly grow by 2035 due to the increasing demand.

According to a member of Gazprom’s management committee, Oleg Aksyutin, the company saw no threat to Gazprom’s business in the European market from global producers of liquefied natural gas (LNG), including the US. The company’s gas exports to Europe are reportedly three times more than the amount of LNG shipped to Europe by all global producers combined. Though the share of LNG shipments have been growing, it still makes up only 13 percent of the entire gas market, according to Burmistrova. The executive added that prices for natural gas saw a significant surge. “In 2018, in accordance with linked fuel prices, the average price of Gazprom gas increased by 24.6 percent to $245.5 for 1,000 cubic meters,” she said, stressing that in 2016 it stood at $167.

When it comes to China, one of the world’s biggest energy consumers, Gazprom is planning to become the country’s biggest supplier as soon as 2035, with the company’s share expected to reach 13 percent of Chinese overall consumption by the same year.

The government is to introduce an official measure of how often low-income families across the UK skip meals or go hungry because they cannot afford to buy enough food, the Guardian can reveal. A national index of food insecurity is to be incorporated into an established UK-wide annual survey run by the Department for Work and Pensions (DWP) that monitors household incomes and living standards. Campaigners, who have been calling for the measure for three years, said the move was “a massive step forward” that would provide authoritative evidence of the extent and causes of hunger in the UK. They say food insecurity is strongly linked to poverty caused by austerity and welfare cuts and is driving widening health inequality.

Food insecurity is generally defined as experiencing hunger, the inability to secure food of sufficient quality and quantity to enable good health and participation in society, and cutting down on food because of a lack of money. The decision, which took campaigners by surprise, was revealed at an informal meeting on Tuesday attended by the DWP, the Office for National Statistics, Public Health England and the Scottish and Welsh governments, as well as a number of food poverty charities. Ministers have for years resisted calls to bring England into line with the US and Canada by measuring food insecurity. Critics said this was to avoid shedding unwanted light on the impact of welfare policy and the public health consequences of being unable to eat regularly or healthily.

A new study has shown that traces of a commonly-used and possibly cancerous weed killer can be found in the majority of wine and beer. Researches tested five wines and 15 beers from the US, Asia and Europe for traces of pesticide glyphosate. The research found that of the 20 samples, 19 (95 per cent) contained particles of the chemical, including products labelled as organic. The US Public Interest Research Group, which conducted the study, said the levels of the pesticide aren’t necessarily dangerous, but are still concerning. In 2015, the World Health Organisation’s International Agency categorised glyphosate as “probably carcinogenic to humans”, leading the state of California to add it to its list of chemicals that can cause cancer, which makes companies responsible for providing warnings to potential consumers.

The findings of the study coincide with the beginning of a class action lawsuit against Bayer, which acquired Monsanto last year. The suit claims that Roundup caused thousands of plaintiffs to develop non-Hodgkins lymphoma, a type of blood cancer. The first plaintiff, Ed Hardeman, testified this week, alleging that his use of the chemical on his 56 acres of land caused him to develop cancer aged 66. [..] Bayer has not commented on the results of the study, but the researchers are calling for glyphosate to be banned unless it can be proven safe.

The earth’s weather system is far too complex to draw conclusions from a sunny day. The only things we can say about the climate must be based on long-term stats. This kind of article doesn’t help one bit, it merely points out the author literally doesn’t know what he’s talking about.

They were everywhere in London on the weekend. The people in short sleeves or sandals. The ones with sunglasses ostentatiously hanging from the front of their shirts or balanced on top of their heads. The beer gardens and riverside pubs of the capital were heaving; corner shops ran out of ice-cream. Outside it was 17C (62F). Monday was another warm day, without a cloud in the sky, and in the late afternoon the light took on a magical, honey-coloured hue. It brought to mind one of those summer evenings you remember from childhood, when you’d be in the park all day and your parents let you stay out until bedtime, and you felt like you were doing something deliciously naughty just by being there.

Except it isn’t early summer: it’s February. And the entire developed world has not so much been doing something slightly naughty as systematically attacking the global ecosystem over a period of decades, and that’s how we go into this mess. We should try to hold on to this fact as young, posh men the nation over develop a strange delusion that anyone would want to see their elbows; this is not supposed to be happening. Less than a month ago, there was video footage of extreme cold weather coming out of Chicago. Forks supported in midair by suddenly frozen noodles, water poured from kettles instantly freezing on its way to the ground: you know the sort of thing.

OK, that was on the other side of the world, and was extreme and terrifying enough. But at least it was terrifying in the right direction. On Monday, though, the temperature hit 20.3C in Ceredigion, west Wales: the highest February temperature ever recorded in Britain and the first time the thermometer had breached 20C in winter. The BBC weather account tweeted it out with a gif of the sunshine icon and the same excitable breathlessness with which Springwatch would announce it had found a new type of vole. My response contained a single word, repeated seven times. It began with F.

President Donald Trump walked out of the negotiations with congressional Democrats, declaring it a “total waste of time” after they repeated their refusal to fund any sort of wall on the border with Mexico. “Just left a meeting with Chuck and Nancy, a total waste of time,” Trump tweeted, referring to Senate Minority Leader Chuck Schumer (D-New York) and Speaker of the House Nancy Pelosi (D-California). “I asked what is going to happen in 30 days if I quickly open things up, are you going to approve Border Security which includes a Wall or Steel Barrier? Nancy said, NO. I said bye-bye, nothing else works!” After the meeting, Schumer and Pelosi denounced Trump for refusing to reopen the government, just as they had the previous evening.

“Again, we saw a temper tantrum because he couldn’t get his way,” Schumer told reporters outside the White House on Wednesday. Federal workers are “as disappointed as we are that Democrats are unwilling to engage in good-faith negotiations,” Vice President Mike Pence told reporters after the meeting. The US government has been partially shut down for almost 19 days, after Senate Democrats refused to back a Republican-majority House bill that would allocate $5.7 billion to building the border wall. Democrats took over the House on January 3, and have proposed bills to reopen the government, but have rejected any funding to the wall, ever, calling it “immoral.”

“This is a crisis… it is a humanitarian crisis, it is a security crisis,” Homeland Security Secretary Kirstjen Nielsen said. “And the reality is that walls work.” Some 800,000 federal workers will soon miss their first paycheck, and each sides has accused the other of ignoring their needs and interests. Prior to the meeting, Trump said he would be willing to declare a national emergency if the talks with Democrats failed. Asked by ABC reporter Jonathan Karl if he would be willing to reopen the government for the sake of federal workers, Trump asked him if he would do so in his place. “If you would do that, you should never be in this position, because you’d never get anything done,” the president said.

Federal Reserve policymakers have indicated they may be open to tweaking a longstanding plan to shrink the central bank’s balance sheet, including by shedding housing-backed bonds earlier than anticipated or keeping a bigger-than-expected portfolio of assets. Those were among a range of options discussed at the Fed’s December meeting, minutes released on Wednesday showed. The discussion will continue at future meetings, the minutes said. JP Morgan chief U.S. economist Michael Feroli, writing in a note to investors, described the debate as informal “spitballing.” Fed Chair Jerome Powell himself said in December that shrinking the balance sheet was on “automatic pilot.”

But the discussion shows that the future of the plan may be in flux as policymakers become increasingly nervous about potential kinks in their control over short-term interest rates. The Fed for years bought bonds to stimulate a moribund economy, eventually accumulating a $4.5 trillion balance sheet, but began reversing course in 2013, first by slowing its bond-purchases and then, in 2017, allowing the portfolio to shrink. The Fed is now trimming its holdings by $50 billion each month, an amount intended to reduce the portfolio to a more “normal” size over a number of years without putting too much pressure on the Fed’s short-term policy rate. It has now shed more than $380 billion worth of U.S. Treasuries and mortgage bonds. But reserves are declining at a much faster rate, dropping to $1.51 trillion at the end of 2018, from a 2014 peak of more than $2.7 trillion.

China is borrowing billions of dollars each year from the World Bank, despite its position as the world’s second-largest economy, according to a study released Thursday. The Center for Global Development found that the World Bank’s International Bank for Reconstruction and Development loaned China an average of $2 billion a year, totaling more than $7.8 billion, since the country surpassed the bank’s income threshold for lending in 2016. The IBRD lends to middle-income and creditworthy low-income countries. It uses resources from those loans to help boost poorer countries. But tension has developed as China is lending billions of dollars of its own to developing countries under opaque terms as part of its “Belt and Road” initiative to build infrastructure.

The administration of U.S President Donald Trump has been critical of lending to China that squeezes out loans to other countries. But cutting off China from World Bank funding could remove a useful tool to influence policy. “If we want China to be a more responsible lender in the world, then let’s use the World Bank to help them along with that,” said Scott Morris, a senior fellow at the Center for Global Development and lead author of the study. The study looked at the type of loans granted to China and found that $3 billion, or about 38 percent of the total, went to things that provide benefits beyond China’s border, such as pollution controls and green infrastructure projects.

[..] Some lawmakers want China reined in. “We must end the World Bank’s lending to China, especially at a time when Beijing itself is saddling developing countries with predatory debt on unfair terms. Growing the Chinese economy is not the World Bank’s job,” said Brad Sherman, D-Calif., a member of the House Financial Services and Foreign Affairs committees.

German industry went into a sudden and unexpected collapse in November. The data is so bad some economists think it might be wrong. Germany may be in recession, economists said, after they trawled through an unexpectedly horrible set of industrial and manufacturing data published on Wednesday’s from the world’s fourth-largest economy. • German industrial production fell by -1.9% in November. • Year over year, production hit a low of -4.6% – the biggest trough since the 2008 crisis. • Germany’s exports fell -0.4% month over month in November, the government reported today. Suddenly, Europe is faltering.

Germany is the largest European economy and its leaders have an outsized influence on the rest of the EU and the European Central Bank. A recession in Germany could easily drag down France and Italy – and the latter country is already likely in a recession of its own. Greece is still struggling to recover from its debt crisis and neighbouring Turkey also dropped into a steep recession, triggered by the devaluation of its currency.

Yellow Vest protesters are hoping to trigger a bank run with a nationwide coordinated cash withdrawal. By threatening the French financial system, protesters say, they want to peacefully force the government to pass their reforms. “If the banks weaken, the state weakens immediately,” said Yellow Vest “sympathizer” Tahz San on Facebook. “It’s elected officials’ worst nightmare.” Protesters plan to empty their bank accounts on Saturday, withdrawing as much money as possible in a bid to undermine the French banks – if not the euro itself. The plan is to “scare the state legally and without violence,” forcing the government to adopt the movement’s Citizens’ Referendum Initiative, which would allow citizens to propose and vote on new laws.

“We are going to get our bread back…you’re making money with our dough, and we’re fed up,” said protester Maxime Nicolle in a video message shared on YouTube. A well-coordinated financial action has the potential to bring the French banking system – and by extension the euro – to its knees, as banks always hold only a fraction of the funds the country’s citizens have in their accounts. However, most banks limit ATM withdrawals to a relatively low amount, meaning protesters would have to line up inside the banks to withdraw the rest of their money, giving the state plenty of time to place restrictions on withdrawals – though this would, no doubt, spark further protest.

Italy’s Euroskeptic deputy prime minister Matteo Salvini has said he wants Italy and Poland to join together to create a “European Spring” which could end the long-standing French and German domination on the continent. Speaking during a press conference with Polish Interior Minister Joachim Brudzinski in Warsaw on Wednesday, Salvini said that Poland and Italy “will be part of the new spring of Europe, the renaissance of European values” which would create a “new equilibrium” where the dominance of France and Germany is diminished. The leader of the Northern League party said that upcoming European parliamentary elections, set for May, could lead away from a Europe “that is run by bureaucrats.”

Salvini, who is aiming to forge alliances with other Eurosceptic parties across Europe ahead of the elections, was in Warsaw for meetings with members of Poland’s ruling Law and Justice party, which shares a similar anti-immigration and anti-Brussels ideology. At the meeting, Brudzinski also praised Salvini’s immigration policy and his decision to close Italian ports to migrant boats, saying that Poland was also committed to “strengthening borders.” At a press conference with France’s right-wing National Rally leader Marine Le Pen in October, Salvini promised a new era of “common sense” was coming to Europe with the rise of nationalist parties. Salvini’s Northern League formed a coalition government with the anti-establishment Five Star Movement in June last year.

M5S leader Luigi Di Maio has also been seeking to make friends with other anti-establishment parties across the continent, holding meetings with a number of party leaders from Poland, Croatia and Finland who share similar values. Earlier this week, Salvini and Di Maio were embroiled in a public feud with French government officials after they threw their support behind France’s Yellow Vest anti-government protest movement. On his public blog, Di Maio urged demonstrators “not to weaken,” and said he planned to meet with some of the activists in the coming days, while Salvini accused French President Emmanuel Macron of being “against his people.” France’s Minister for European Affairs, Nathalie Loiseau, shot back, telling the Italian duo to “sweep their own doorstep” before commenting on French affairs.

MPs are weighing up how quickly to launch a bid for a fresh referendum on Brexit, after inflicting a stunning defeat on Theresa May which cleared the way for a Commons vote. Another Conservative revolt will force the prime minister to present her “plan B” within just three working days of what seems certain to be a heavy defeat of her proposed deal next Tuesday. The victory torpedoed Ms May’s apparent plan to force MPs to vote multiple times on that deal, while “running down the clock” to the threat of crashing out of the EU with no agreement, as the feared alternative. It triggered chaotic scenes in the Commons, as furious Brexiteers accused John Bercow, the Commons speaker, of blatant bias in allowing the vote, against legal advice.

The government must now table a motion, setting out what it plans to do if it loses on Tuesday, by 21 January – which, crucially, could be amended to allow parliament to “take back control”, as one senior Tory put it. Supporters of a Final Say referendum are weighing up whether to go for the kill immediately, or wait until after Jeremy Corbyn has, finally, set out Labour’s position. All eyes will be on the Labour leader, amid a growing expectation he will table a vote of no confidence in the government next week, to try to force a general election. That is likely to fail, piling enormous pressure on Mr Corbyn to then back a fresh referendum – without which a Commons majority for a public vote is unlikely.

[..] by 21 January, there may still be no Commons majority for any alternative to Ms May’s doomed plan, whether a referendum, extending Article 50, or the soft Brexit “Norway option”. Furthermore, even if an amendment did pass, the government would not be legally required to comply with what the Commons had voted for…

Theresa May’s room for manoeuvre should her Brexit deal be rejected next week was further constrained on Wednesday night, after the government lost a second dramatic parliamentary showdown in as many days. An increasingly boxed-in prime minister must now set out her plan B within three working days of a defeat next Tuesday, after the rebel amendment passed. There were furious scenes in the House of Commons as the Speaker, John Bercow, took the controversial decision to allow a vote on the amendment, tabled by the former attorney general Dominic Grieve. A string of MPs, including the leader of the house, Andrea Leadsom, repeatedly intervened to question the Speaker’s approach. Some accused him of being biased against Brexit.

But parliament went on to back Grieve as the prime minister was defied by Conservative rebels determined to hand control of the Brexit process to MPs if next week’s vote is lost. The fresh defeat, which followed a separate backbench amendment to the finance bill on Tuesday, means the government will have to return to parliament swiftly with a plan. An accelerated timetable will also pile the pressure on Labour to move quickly. The motion setting out the government’s plan can be amended by MPs hoping to push their own alternative proposals, from a second referendum to a harder Brexit.

Theresa May is on a fresh collision course with Brussels after the government said it would give MPs the chance to override a key part of the exit deal agreed with the European Union. In a new bid to win over Tory rebels, ministers announced they would support moves to ensure parliament is given a vote in 2020 on whether or not to enter the controversial Northern Ireland backstop. That could see MPs vote to block the UK entering the backstop, even though it would be legally bound to do so under the terms of the withdrawal agreement. The government said on Wednesday that it will accept an amendment tabled by former Tory minister Sir Hugo Swire.

The motion says that if no trade deal with the EU is in place by 2020 ministers must hold a vote in parliament on whether or not to enter the backstop, and must limit the UK’s participation in the mechanism to one year. Both appear to contradict the terms of the withdrawal agreement with Brussels, which states that the backstop is the default option if a deal on the future relationship is not in place by the end of 2020 and says that this will apply indefinitely.

The government has been accused of presiding over “significant and growing” hunger as a report warns that one in five children in the UK live in homes that are severely food insecure – making it the worst for child hunger in Europe. A combination of high living costs, stagnating wages and the rollout of universal credit has led to a steady rise in food insecurity – yet ministers have allowed the issue to “fall between the cracks”, according to a report by the Environmental Audit Committee. In a damning indictment of the welfare system, the MPs accuse the government of being “silent” on food insecurity in its obesity strategy, and call for the appointment of a “minister for hunger” to ensure cross-departmental action on the issue.

The report cites figures showing that 2.2 million people in Britain are severely food insecure – the highest reported level in Europe. This indicates that the UK is responsible for one in five of all severely food insecure people on the continent. Recent data published by Unicef shows one in five youngsters under 15 now live in a food insecure home – which the committee described as a “scandal that cannot be allowed to continue”. It comes after Philip Alston, the UN’s special rapporteur on extreme poverty and human rights, said policies and drastic cuts to social support were entrenching high levels of poverty and inflicting unnecessary misery in the UK, and that Brexit was exacerbating the problem.

The Dark Overlord hacker group has released decryption keys for a second batch of 9/11 documents, totalling over 7,500 files. Additional document leaks containing “more secrets” and “more truth” have been promised, for a price. The first batch of the supposed 18,000 documents was made available by the hackers at the weekend, along with a decryption key for ‘layer 1’ of the dump. The documents are believed to have been stolen from insurance companies, law firms and government agencies, and the hackers originally demanded an unspecified bitcoin ransom to keep them unreleased. After apparently failing to secure the ransom, the group then took bitcoin donations from the public, releasing ‘layer 1’ after collecting $12,000 – but then also releasing ‘layer 2’ on Wednesday despite not meeting its funding target.

So far, no ‘smoking gun’ has emerged detailing conspiracy or government involvement in the terrorist attacks. Instead, the documents build up a picture of insurance litigators brainstorming to see who they could sue for damages in the wake of the attacks. In emails, the lawyers discuss targeting the airlines, airplane manufacturers, the Federal Aviation Authority, the terrorists themselves, and foreign entities. Talking strategy, the lawyers mull taking action against Boeing for not fitting the 757 and 767 aircraft used in the attacks with automatic transponders, which could have alerted authorities sooner that something was amiss, a case that the lawyers admit in the documents was flimsy. The lawyers also discuss dropping a case against the FAA, for fear of rankling the government.

[..] The hacker group has promised three more layers of documents to come, if its price is met. The latest leak was accompanied with the message: “Continue to keep the bitcoins flowing, and we’ll continue to keep the truth flowing.” The hackers are asking for $2 million in bitcoin for the public release of its “megaleak,” which it has dubbed “the 9/11 Papers.” [..] The group may have a hard time paying its members if the latest ransom demands are not met, however. Cyberscoop reported on Tuesday that the group was posting recruitment ads on dark web forums in November, looking to hire four skilled cybercriminals. New employees were reportedly promised 50,000 pounds ($63,500) monthly, bumped up to 70,000 pounds ($89,000) after two years’ service.

George, a Hawaiian tree snail—and the last known member of the species Achatinella apexfulva—died on New Year’s Day. He was 14, which is quite old for a snail of his kind. George was born in a captive breeding facility at the University of Hawaii at Manoa in the early 2000s, and soon after, the rest of his kin died. That’s when he got his name—after Lonesome George, the Pinta Island tortoise who was also the last of his kind. For over a decade, researchers searched in vain for another member of the species for George to mate with, to no avail. (Though these snails are hermaphrodites, two adults must mate to produce offspring, and researchers refer to George as a “he.”)

Photograph Courtesy Aaron K. Yoshino, Honolulu Magazine

“I’m sad, but really, I’m more angry because this was such a special species, and so few people knew about it,” says Rebecca Rundell, an evolutionary biologist with State University of New York who used to help care for George and his kin. Throughout his life, George was a public face for the struggles facing Hawaiian land snails. His death highlights both the vast diversity of indigenous snails—and their desperate plight. “I know it’s just a snail, but it represents a lot more,” says David Sischo, a wildlife biologist with the Hawaii Department of Land and Natural Resources and coordinator of the Snail Extinction Prevention Program.

[..] In some ways, these snails are more like mammals or birds than other invertebrates: They regularly live well into their teens, take five or more years to reach sexual maturity, and give birth to less than ten offspring per year. They’re revered in Native Hawaiian legends which hold that tree snails can sing beautifully, and are known as the ‘voice of the forest’. (It’s not clear why since they aren’t known to make audible noises.) [..] Land snails and slugs represent about 40 percent of the known animal extinctions since 1500, more likely disappeared before becoming known to science …

Snails in the Achatinellinae family live on multiple Pacific islands, but are most diverse in Hawaii. Like many snails they face serious threats, particularly invasive predators, and hundreds of species have already gone extinct. Photographs Courtesy David Sischo, Hawaii Department Of Land And Natural Resources

History has a velocity of its own, and its implacable forces will drag the good, the bad, the clueless, the clever, the guilty, the innocent, the avid, and the unwilling to a certain fate. One can easily see a convergence of vectors shoving the nation toward political criticality this autumn. Mr. Trump is like some unfortunate dumb brute of the ancient Teutonic forests with a bulldog clamped to his nose, the rest of the pack close behind snapping at his hamstrings and soft, swaying underbelly. His desperate bellowing goes unanswered by the indifference of the trees in forest, the cold moon above, and all the other furnishings of his tragic reality.

As these things tend to happen, it looks like the exertions of Robert Mueller have turned from the alleged grave offenses of a foreign enemy to the sequela of consort with a floozie. Down goes Mr. Trump’s private attorney, Michael Cohen, in his personal swamp of incriminating files and audio recordings. Enter, stage left, one David Pecker, publisher of the venerable National Enquirer — the newspaper of wreckage — on his slime-trail of induced testimony. And there is your impeachable offense: an illegal campaign contribution. One way or another, as Blondie used to sing, I’m gonna getcha, getcha, getcha.

Some in this greatest of all possible republics may be asking themselves if this is quite fair play, given the hundreds of millions of dollars washed-and-rinsed through the laundromat known as the Clinton Foundation, and related suspicious doings in that camp of darkness. But remember, another president, Jimmy Carter, once declared to the shock of official Washington that “life is unfair.” What I wonder is what these dogs of vengeance reckon will happen when they achieve their goal of bringing down the bellowing bull and pulling his guts out. Perhaps a few moments of tribal satisfaction, one last war dance around the fire, and when the fire dies out, they will find themselves under the same cold indifferent moon with blood on their snouts and an ill wind blowing in the tree tops.

The US and its allies are preparing new airstrikes on Syria, the Russian Defense Ministry said, adding that militants are poised to stage a chemical weapons attack in order to frame Damascus and provide a pretext for the strikes. The attack would be used as a pretext for US, UK and French airstrikes on Syrian targets, Russian Defense Ministry spokesman, Major General Igor Konashenkov said. USS ‘The Sullivans,’ an Arleigh Burke-class Aegis guided missile destroyer, was already deployed to the Persian Gulf a couple of days ago, he added. The destroyer has 56 cruise missiles on board, according to data from the Russian Defence Ministry.

A US Rockwell B-1 Lancer, a supersonic bomber equipped with 24 cruise missiles, has also been deployed at the Qatari Al Udeid Airbase. The provocations are being prepared by militants from Al-Nusra Front (now known as Tahrir al-Sham) in Idlib province, northwestern Syria, In order to stage the attack, some eight canisters of chlorine were delivered in to village near Jisr al-Shughur city for the terrorists’ use, he added. A separate group of militants, prepped by private British security company Olive, have also arrived in the area. The group will be disguised as volunteers from the White Helmets group and will simulate a rescue operation involving locals purportedly injured in the attack, according to the military official.

Forget fashion, music or gadgets. The desire to live up to social media aspirations has pushed more than half of millennials to buy a car for its status value, new figures suggest, and almost 40 per cent said Instagram or Facebook played a part in deciding which motor they went for. With two thirds of younger drivers reliant on credit to fund the purchase – twice the number of 37- to 54-year-old generation Xers – research from Admiral has revealed the new, expensive face of social media influencing. Younger drivers were found to be more reliant on credit, with 64 per cent taking car finance to fund a purchase compared with 38 per cent of 37- to 54-year-olds.

The consequences have financial implications on younger generations too, as more than half of drivers aged 19 to 36 admit feeling pressure to buy a specific car for status or prestige. More than one in 10 millennials said famous faces played a part in their choice of car, compared with just 4 per cent of gen-X drivers. They may currently own a Ford Fiesta, Vauxhall Corsa, VW Golf or Polo, but millennials dream of BMW i8s, Audi R8s, Ford GTs and Aston Martin Vantages.

New analysis from CNS News finds that the majority of Americans under 18 live in households that take “means-tested assistance” from the US government. The study, based on the most recently available data from the Census Bureau, leads with the question: Will they be called The Welfare Generation? The data presented by CNS editor Terrence Jeffrey shockingly reveals that in 2016 “there were approximately 73,586,000 people under 18 in the United States, and 38,365,000 of them — or 52.1 percent — resided in households in which one or more persons received benefits from a means-tested government program.”

It’s a slim majority, but a majority which nonetheless presents an extremely worrisome trend regarding the number of young Americans and possibly young families who’ve experienced some level of government dependency. To put it in another, perhaps more alarming way, if you’re under 18 the data shows you are more likely that not to be living in a home that receives some form of taxpayer-financed largesse. In terms of the country’s total population of 319.9 million Americans, the data finds that 114.8 million, or about 36 percent, lived as part of a household in which someone collected welfare. Jeffrey continued, “When examined by age bracket persons under 18 were the most likely to live in a household receiving means-tested government assistance (52.1 percent), while those 75 and older were least likely (18.8 percent).”

Twitter CEO Jack Dorsey is scheduled to appear before the House Energy & Commerce committee on September 5th, after several GOP lawmakers demanded action in response to reports of conservatives being “shadow banned” by the San Francisco-based social media giant. “Twitter is an incredibly powerful platform that can change the national conversation in the time it takes a tweet to go viral,” wrote committee Chair Greg Walden (R-OR) in a Friday statement. “When decisions about data and content are made using opaque processes, the American people are right to raise concerns. This committee intends to ask tough questions about how Twitter monitors and polices content, and we look forward to Mr. Dorsey being forthright and transparent regarding the complex processes behind the company’s algorithms and content judgement calls,” the statement continues.

Earlier this month, House Majority Leader Kevin McCarthy sent a letter to Walden, requesting that he be allowed to publicly grill Jack Dorsey over recent allegations that the platform limits the reach of some conservative accounts. “Any solution to this problem must start with accountability from companies like Twitter, whose platforms have enormous potential to impact the national conversation — and unfortunately, enormous potential for abuse,” McCarthy said in the letter to House Energy and Commerce Committee Chairman Greg Walden. “In particular, I would like to request a hearing with Twitter CEO Jack Dorsey so that the American people can learn more about the filtering and censorship practices on his platform.” -Kevin McCarthy

McCarthy, who has worked on tech issues for years, has been investigating reports of Silicon Valley tech giants injecting their admittedly liberal bias into the way they enforce speech on their platforms. McCarthy and other Republican leaders met with Facebook staffers in June over their concerns, and as recently as last month McCarthy was running ads on Facebook inviting supporters to join him “and President Trump in defending our conservative voice against social media censoring,” according to the platform’s public database of political ads. This action follows Rep. Matt Gaetz (R-FL) complaint filed with the Federal Election Commission (FEC) against Twitter after he discovered that his account was being ‘shadowbanned’ – the practice of excluding or reducing the visibility of one’s tweets from normal circulation on the platform.

The immigration minister blocked at least two British citizens on Twitter when they asked for her assistance after the Home Office failed to respond to their complaints or appeals from their MPs. Caroline Nokes’ action, which means the people concerned are unable to read her tweets or contact her, were described by a leading immigration lawyer as suggesting “complete indifference”. Stephen Buck was blocked from following Nokes or seeing her tweets on 11 August after he sent her three tweets in four months, asking for help to prevent his long-term partner, Rusty Goodall, from being deported to Australia. It took the Home Office 13 months to refuse Goodall’s application to extend his visa, during which time the couple received no update on his case.

“I was nothing but polite in my approaches, but having tried all other avenues available to us (ie contacting the Home Office directly, asking our MP for help) and still feeling as though we were in a position where nobody was doing anything and nobody cared about us, contacting Nokes on Twitter felt like the only option left to try and get somebody in power to listen,” Buck said. “The fact that the only response to these pleas to one of the few people who could make a difference in our case was to block me, was truly upsetting, frustrating and insulting.” John Holden, a British citizen who lives in the UK with his Filipino wife, son and three adopted children, was blocked by Nokes on the same day as Buck after also asking for help.

“The Home Office have refused to issue my British children with British passports: they say we need to change the children’s Philippine passports to their new adopted surnames first,” he said. “The problem is that the Philippine authorities won’t do that unless we take the children out of school and return to the Philippines for a process that could take up to 18 months, during which I would have to readopt children who are already mine and are already British.

In 1995, Singer started working with a trader named Jay Newman, who specialized in the government—or sovereign—debt of developing countries. The collaboration led to the legal battle that would publicly define Singer: his fourteen-year fight with the government of Argentina. Like Singer, Newman was a lawyer by training, and, also like Singer, he had no problem making money using methods that others might find distasteful. For many years, sovereign loans were treated by banks and other lenders much the way that subprime mortgages were prior to 2008—as highly desirable, relatively low-risk investments.

But many countries, particularly poorer ones with fragile economies or corrupt governments, borrowed far more than they could realistically repay, and, during the nineteen-eighties, approximately fifty countries defaulted or had to restructure their debt, including Mexico, most of Latin America, Poland, the Philippines, Vietnam, and South Africa. In most cases, the International Monetary Fund would come in, impose budget cuts and other austerity measures, and help the governments renegotiate what they owed. The countries’ debt holders generally traded their old bonds for new ones under reduced terms, which allowed the country to exit default.

Newman saw an opportunity in these financial crises: purchase the defaulted debt at a very low price and then try to negotiate for, or sue the country for, full repayment on the original terms. An investor who pursued this strategy came to be known as a “rogue creditor.” The tactic could prove extremely profitable—as long as you had the stomach for it. Newman said that he never sued a country that couldn’t afford to pay, but critics argue that rogue creditors interfere with a country’s ability to return to the financial markets, exacerbating the poverty and suffering of its citizens. Singer hired Newman, initially offering him thirty thousand dollars a month and 20% of the profits on investments he recommended.

The Republic of Peru had defaulted on its debt in 1984; in 1996, the government initiated a debt exchange, and more than ninety per cent of Peruvian debt holders traded in their old bonds for new ones, taking a fifty-per-cent discount on the original value. Singer purchased eleven million dollars of defaulted Peruvian bonds, and then began a protracted legal battle to force the government to pay back the full value. In 1998, after a trial, a federal court found Elliott to be in violation of the Dickensian-sounding Champerty laws, which prohibit buying debt with the sole purpose of bringing legal action. Elliott appealed the case and won. The company later engaged in an intense lobbying campaign to change the Champerty laws in New York State.

It also filed a lawsuit in Brussels, attempting to prevent Peru from paying interest on any of its new bonds until it had paid Elliott. Peru was left with an unpalatable choice: default, again, on its new bonds, or pay what it viewed as a ransom to a New York hedge fund.

Tesla CEO Elon Musk said Friday that the company would continue to be publicly traded, weeks after suggesting that he would take the electric carmaker private. Musk met with Tesla’s board of directors on Thursday “and let them know that I believe the better path is for Tesla to remain public. The Board indicated that they agree,” he wrote on the company blog. Musk surprised markets on August 7 by announcing on Twitter he wanted to take Tesla private at $420 a share. But shares fell more than 20 percent since the announcement. After the announcement the controversial entrepreneur came under extensive scrutiny over his Twitter statements related to the proposal, especially a claim that Tesla had “secured” funding for the move.

However, Musk said Friday that based on talks with current shareholders, as well as an assessment by financial advisers Silver Lake, Goldman Sachs and Morgan Stanley, “it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company.” Even though the majority of shareholders “said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this,'” he wrote. “I knew the process of going private would be challenging, but it’s clear that it would be even more time-consuming and distracting than initially anticipated.”

The patterns of the heists were evident only later, but their audacity was clear from the start. The spree began in Stockholm in 2010, with cars burning in the streets on a foggy summer evening. The fires had been lit as a distraction, a ploy to lure the attention of the police. As the vehicles blazed, a band of thieves raced toward the Swedish royal residence and smashed their way into the Chinese Pavilion on the grounds of Drottningholm Palace. There they grabbed what they wanted from the permanent state collection of art and antiquities. Police told the press the thieves had fled by moped to a nearby lake, ditched their bikes into the water, and escaped by speedboat. The heist took less than six minutes.

A month later, in Bergen, Norway, intruders descended from a glass ceiling and plucked 56 objects from the China Collection at the KODE Museum. Next, robbers in England hit the Oriental Museum at Durham University, followed by a museum at Cambridge University. Then, in 2013, the KODE was visited once more; crooks snatched 22 additional relics that had been missed during the first break-in. Had they known exactly what was happening, perhaps the security officials at the Château de Fontainebleau, the sprawling former royal estate just outside Paris, could have predicted that they might be next. With more than 1,500 rooms, the palace is a maze of opulence. But when bandits arrived before dawn on March 1, 2015, their target was unmistakable: the palace’s grand Chinese Museum.

Created by the last empress of France, the wife of Napoleon III, the gallery was stocked with works so rare that their value was considered incalculable. In recent years, however, the provenance of those treasures had become an increasingly sensitive subject: The bulk of the museum’s collection had been pilfered from China by French soldiers in 1860 during the sack of Beijing’s Old Summer Palace. In the low light before daybreak, the robbers raced to the southwest wing and shattered a window. They climbed inside, stepping over broken glass, and swiftly went to work dismantling the empress’s trove. Within seven minutes, they were gone, along with 22 of the museum’s most valuable items: porcelain vases; a mandala made of coral, gold, and turquoise; a Chimera in cloisonné enamel; and more.

A lengthy drought in Europe has exposed carved boulders, known as “hunger stones,” that have been used for centuries to commemorate historic droughts — and warn of their consequences. The Associated Press reports that hunger stones are newly visible in the Elbe River, which begins in the Czech Republic and flows through Germany. “Over a dozen of the hunger stones, chosen to record low water levels, can now be seen in and near the northern Czech town of Decin near the German border,” the AP writes. One of the stones on the banks of the Elbe is carved with the words “Wenn du mich siehst, dann weine”: “If you see me, weep.” A team of Czech researchers described that stone in detail in a 2013 paper about the history of droughts in Czech lands.

The stone is also chiseled with “the years of hardship and the initials of authors lost to history,” the researchers wrote: “It expressed that drought had brought a bad harvest, lack of food, high prices and hunger for poor people. Before 1900, the following droughts are commemorated on the stone: 1417, 1616, 1707, 1746, 1790, 1800, 1811, 1830, 1842, 1868, 1892, and 1893.” That particular stone is now a bit of a tourist attraction; it’s one of the oldest hydrological landmarks in central Europe. Also, because of a dam on a tributary of the Elbe, it’s seen more often now than it used to be, according to a Decin tourist site — although the current river levels are still exceptional.

Water cannot be created or destroyed; it can only be damaged. When Gleick says we’ll never run out, he means that at some point, millions of years ago, there was all the water there is, a result of the law of the conservation of matter. Having evaporated from lakes and rivers and oceans and returned as snow and rain, the water we consume has been through innumerable uses. Dinosaurs drank it. The Caesars did, too. It’s been places, and consorted with things, that you might not care to think about. In theory, there’s enough freshwater in the world for everyone, but like oil or diamonds or any other valuable resource, it is not dispersed democratically. Brazil, Canada, Colombia, Peru, Indonesia, and Russia have an abundance—about 40 percent of all there is.

America has a decent amount. India and China, meanwhile, have a third of the world’s people and less than a tenth of its freshwater. It is predicted that in twelve years the demand for water in India will be twice the amount on hand. Beijing draws water from an aquifer beneath the city. From being used faster than rain can replenish it, the aquifer has dropped several hundreds of feet in the last forty years, and in places the city is sinking four inches every year. As for the world’s stock, however, nearly all of the water on earth is salty; less than 3% is fresh. Some of that is in rivers, lakes, aquifers, and reservoirs—the Great Lakes contain one fifth of the freshwater on the earth’s surface—and we have stored so much water behind dams that we have subtly affected the earth’s rotation; but two thirds of all the freshwater we have is frozen in the earth’s cold places as ice or permafrost, leaving less than 1% of the world’s total water for all living things.

Much of that gets a rough ride. American ponds and streams and lakes and rivers contain fungicides, defoliants, solvents, insecticides, herbicides, preservatives, biological toxins, manufacturing compounds, blood thinners, heart medications, perfumes, skin lotions, antidepressants, antipsychotics, antibiotics, beta blockers, anticonvulsants, germs, oils, viruses, hormones, and several heavy metals. Not all of these are cleansed from water before we drink it.

The exodus of migrants from Venezuela is building toward a “crisis moment” comparable to events involving refugees in the Mediterranean, the United Nations migration agency said on Friday. Growing numbers are fleeing economic meltdown and political turmoil in Venezuela, where people scrounge for food and other necessities of daily life, threatening to overwhelm neighbouring countries. Officials from Colombia, Ecuador and Peru will meet in Bogota next week to seek a way forward. In Brazil, rioters this month drove hundreds back over the border. Peru tightened entry rules for Venezuelans, requiring them to carry passports instead of just national ID cards, though a judge in Ecuador on Friday rolled back a similar rule enacted there.

Describing those events as early warning signs, a spokesman for the International Organization for Migration, Joel Millman, said funding and means of managing the outflow must be mobilised. “This is building to a crisis moment that we’ve seen in other parts of the world, particularly in the Mediterranean,” he said. On Thursday, the IOM and UN refugee agency UNHCR called on Latin American countries to ease entry for Venezuelans, more than 1.6 million of whom have left since 2015.

Desperate Venezuelan migrants who made it across the border in time were breathing a sigh of relief hours before Peru’s tightened controls came into effect Saturday, preventing those not carrying passports from entering. “We have been on the road for five days. We traveled by bus and saw people, Venezuelans, walking along the road,” Jonathan Zambrano, 18, told AFP. Thousands of migrants fleeing the crippling economic crisis in their homeland had faced a race against time to cross into Peru from either Ecuador or Colombia after last week’s announcement from Lima that they had one week to enter before a passport would be required.

Until Saturday, a simple identity card was enough for Venezuelans heading south to escape food and medicine shortages, hyperinflation and failing public services back home. At one border crossing, Peruvian officers handed out balloons to exhausted children, but many Venezuelans feared it would be a different story once the new rules come into force. “People arrive with very few resources and after having traveled, five or six days being the shortest. There are people who’ve been traveling for months,” Regine de la Portilla of the United Nations refugee agency UNHCR told AFP.

Ecuador opened a “humanitarian corridor” on Friday and lifted its own entry restrictions to facilitate the Venzuelans’ travels to Peru, one of the region’s fastest growing economies with 4.7 percent growth projected for next year. Ecuadoran Interior Minister Mauro Toscanini said Friday that 35 busloads of migrants were on the move along the route authorities had opened to Peru.

A girl suffering “resignation syndrome” and who is refusing all food and water has been ordered off Nauru by an Australian court, as a succession of critically ill children are brought from the island. At least three children have left the island since Thursday, and reports from island sources say at least three more children, as young as 12, are “on FFR” – food and fluid refusal. The current crisis on the island is overwhelming medical staff, who are referring dozens of children for transfer off the island, only to have their decisions rebuffed by Australian Border Force officials on the island or department of home affairs bureaucrats in Canberra. Two children were moved off the island with their families on Thursday.

Early on Friday morning, a 14-year-old refugee boy suffering a major depressive disorder and severe muscle wastage after not getting out of bed for four months, was flown directly from Nauru to Brisbane with his family. There are concerns, doctors say, he may never be able to walk normally again. Later on Friday, in the federal court, Justice Tom Thawley ordered another girl – given the designation EIV18 by the court – to be moved to Australia for urgent medical treatment. Court orders prevent publication of the girl’s age – other than the fact she is a child – her name or country of origin. [..] The girl has been inside the supported accommodation area of the regional processing centre for three weeks, and has been refusing food and water for much of that time.

Before she, too, fell into acute depression and “resignation syndrome”, and refused to eat or drink anything, she had been one of the brightest and most articulate of the refugee children on Nauru. “Before she got sick, she was the best-performing student,” a source familiar with the girl and her condition told the Guardian. “She had a dream to be a doctor in Australia and to help others. Now, she is on food-and-fluid refusal and begging to die as death is better than Nauru.”

U.S. President Donald Trump took a pessimistic view of talks with European Commission President Jean-Claude Juncker set for Wednesday aimed at averting a trade war. In a tweet on Tuesday night, Trump said both the United States and the European Union should drop all tariffs, barriers and subsidies. “That would finally be called Free Market and Fair Trade!” Trump said. “Hope they do it, we are ready – but they won’t!” he said. Trump has accused the EU of unfair trade practices and has threatened to raise tariffs on cars imported from the bloc.

European Trade Commissioner Cecilia Malmstrom, who will accompany Juncker, said last week that the EU was preparing a list of U.S. products to hit if the United States imposed the tariffs. Juncker will not arrive in Washington with a specific trade offer, the commission said on Monday. “I do not wish to enter into a discussion about mandates, offers because there are no offers,” Commission spokesman Margaritis Schinas told a news conference in Brussels. White House economic adviser Larry Kudlow has said he expected Juncker to come with a “significant” trade offer.

EU agriculture is built on enormous subsidies. No way they can let much of that go. Imagine the protests in France. Perhaps countries, but certainly continents should focud on producing their own food, not export it. But then the tiny Netherlands is the 2nd biggest tomato exporter in the world. That’s quite an applecart to upset.

According to the statement from the USDA, the administration “will take several actions to assist farmers in response to trade damage from unjustified retaliation.” The plan authorizes the agency to spend “up to $12 billion in programs, which is in line with the estimated $11 billion impact of the unjustified retaliatory tariffs on U.S. agricultural goods. These programs will assist agricultural producers to meet the costs of disrupted markets.” “Our farmers, our producers, they don’t want bailouts,” Simon Wilson, executive director of the North Dakota Trade Office, told CNBC’s “Closing Bell” on Tuesday. “They don’t want this help in the short term. They want long-term stability.”

Wilson added, “A lot of people have been hurt, so that’s a lot of money that’s going to have to be shared.” Payments under the largest part of the federal government’s relief plan would be targeted to producers of soybeans, sorghum, corn, wheat, cotton, dairy and hogs. Some experts have warned in the past that government aid or new subsidies could distort or disrupt markets and ultimately have negative consequences for the agriculture industry. That also includes the possibility it could lead to more retaliation on other agricultural exports.

In any event, Glauber said the program is likely to be taken as “producer support” and appears to be targeted toward a drop in the market price of certain commodities, meaning it could get counted against the U.S. commitments from the WTO. “We’ve run pretty low levels of [producer] support in recent years, but it will certainly raise a lot of eyebrows and will make people look at those calculations very, very carefully,” said Glauber. “It also will look at the way we formulate those programs very, very carefully.”

After a surprisingly dovish meeting in June, the European Central Bank (ECB) is expected to strike a more balanced tone this week, given heightened uncertainties for the global economy. The focus will be on the ECB‘s assessments of these risks at its meeting Thursday, with investors concerned of the acute risk of a trade war escalation. “We expect Mario Draghi to aim for a ‘Goldilocks’ tone at the July 26 press conference — not too hawkish, not too dovish,” said Mark Wall, the chief economist at Deutsche Bank, in a research note. “The ECB only recently made a commitment to unchanged rates for the next year to lean against trade and volatility risks and avoid an unwarranted tightening of financial conditions.”

The ECB has committed itself to stop buying new bonds at the end of this year, but the onus clearly now is on the reinvestment of these purchases (as part of its crisis-era stimulus program) and its refined rate guidance. The euro zone’s central bank pledged to keep its key interest rate at minus 0.4 percent “at least through the summer of 2019” during its last meeting. The risks now are that the ECB is unwinding its monetary stimulus right at a time when the economy could head south. For now, its seems the ECB is convinced the region’s economy will remain resilient.

Alphabet CEO Larry Page has long admired Warren Buffett’s business acumen in creating the industrial and investment conglomerate Berkshire Hathaway. And now analysts and investors are noticing Alphabet’s investments in emerging disparate businesses are starting to bear fruit — including YouTube, autonomous cars and cloud computing — drawing comparison to Berkshire Hathaway’s success. The internet giant reported better-than-expected second-quarter earnings Monday, driving Alphabet shares to a new all-time high the following day. It generated adjusted earnings per share of $11.75 versus the Wall Street consensus of $9.59 for the quarter. Alphabet also posted a $1.06 billion gain in its equity investments for the time period.

“Our investments are driving great experiences for users, strong results for advertisers, and new business opportunities for Google and Alphabet,” said Ruth Porat, CFO of Alphabet and Google in the earnings press release Monday. As a result one well-known investor believes Alphabet has a shot of being the Berkshire Hathaway of tomorrow. “What I’m really talking about is the diversified nature of what [Alphabet is] building away from the ad platform, in much the same way as Berkshire reinvested the float from insurance premiums into other investments. I guess I am also talking in terms of longevity, not just size,” Josh Brown said in an email Tuesday. “This quarter witnessed a host of Google’s other investments throwing off profits. Larry and Sergey were very open about their intention to create something Berkshire-like when they first announced the new structure and Alphabet.”

Theresa May has taken back control of crucial negotiations with Brussels from her new Brexit secretary just hours after the government published its white paper on withdrawing from the EU. The prime minister announced she would now lead the crunch talks with the EU while Dominic Raab, who was appointed two weeks ago, would be left in charge of domestic preparations, no-deal planning and legislation. The move was swiftly characterised as a “sidelining” of the Brexit secretary by No 10’s Europe unit, led by May’s chief Brexit adviser, Olly Robbins, with the prime minister also taking officials from his department. In a written statement on the last sitting day of the Commons before the summer recess, May said: “I will lead the negotiations with the European Union, with the secretary of state for Exiting the European Union deputising on my behalf.

“Both of us will be supported by the Cabinet Office Europe Unit and with this in mind the Europe Unit will have overall responsibility for the preparation and conduct of the negotiations, drawing upon support from DExEU and other departments as required.” Robbins, appearing alongside Raab at the Commons’ Brexit committee, said: “The overall strategy for the conduct of these negotiations, she regards very much as her personal responsibility, now with the secretary of state very close at hand.” Raab described the changes as a “shifting of the Whitehall deckchairs” and said there would now be “one team, one chain of command” but pointed out that there would be “full assertion of ministerial accountability”.

A messy, no-deal Brexit could throw 48 million insurance contracts and £26 trillion ($34 trillion) of derivatives deals into confusion. Nausicaa Delfas, head of international strategy at the Financial Conduct Authority (FCA), told delegates at a CityUK and Bloomberg event that there were “cliff-edge” risks due to uncertainty over the legality of financial contracts extending beyond the planned Brexit date, in March. The UK government has already passed regulations that would allow European banks and insurers to maintain their UK operations under current rules after Brexit. So far, the EU has refused to reciprocate, even on a temporary basis.

The EU has also ruled out extending passporting rights to UK financial institutions after Brexit. These rights allow UK-based institutions to sell financial products from the City to investors in the 27 other EU member states. Brussels has also turned down the UK government’s latest proposal for a system of “advanced equivalence” between British and EU financial services. If the EU continues to reject a temporary permissions regime and no cooperative Brexit deal is signed by the March 29 deadline, big doubts could be raised about the viability of certain derivatives contracts. And that could seriously disrupt an already highly volatile, deeply opaque, largely unregulated $600-trillion dollar industry.

Ministers will have the power to block foreign takeovers across all sectors of the British economy on national security grounds under new government proposals designed to protect some of the UK’s most important and technically advanced businesses. The business secretary, Greg Clark, wants to widen the scope of the current system, which is limited to large transactions and certain industries such as defence, to cover all UK firms including small businesses as he seeks to keep vital firms and technologies out of foreign ownership. The proposals, which will be subject to a 12-week consultation, will allow ministers to halt or unwind takeovers and even the smallest asset sales that could be deemed to jeopardise Britain’s national security.

Potential targets under the new rules are likely to be Chinese and Russian takeovers of defence-related industries. Technology firms, including cybersecurity businesses that already have links with the Ministry of Defence, or are viewed as crucial to the development of the UK’s financial and commercial defence systems, are also expected to top the list of ministers’ national security concerns. Clark allowed the £74m takeover of the handset maker Sepura by the Hytera Corporation of China last year, making it only the second review of a transaction on national security grounds in 18 months, after the MoD raised concerns this month over the sale of Northern Aerospace to a Chinese buyer. The Competition and Markets Authority later cleared the Northern Aerospace transaction, by which time it had lapsed.

Offshore owners of British property will be forced to reveal their true identities or face jail sentences and unlimited fines under draft laws that aim to end the UK’s reputation as a high-risk jurisdiction for money laundering. The legislation follows years of scandals involving the acquisition of high-value UK property by offshore companies, and concerns that a lack of regulation was allowing corrupt money into the housing market. The National Crime Agency said three years ago that overseas criminal gangs were using British property transactions to launder billions of pounds in corrupt funds. Parliament’s foreign affairs committee went further earlier this year, saying that corrupt Russian funds laundered through the UK, including via property, posed a threat to national security.

Under the new legislation, overseas companies that own UK properties will be required to identify their true owners on a publicly available register. The government said the register was part of a wider crackdown on money laundering in the property sector, and would make it easier for law enforcers to seize criminal assets. The anonymous ownership of property via offshore companies is perfectly legal, but it has also been a subject of concern for housing campaigners concerned about an influx of foreign money forcing up house prices.

There was a time when Australia’s housing bubble was not much more than a curiosity. Contained mostly to Sydney it seemed it would pass with a little pop and be forgotten. Then there was a time when the bubble went national. And suddenly the little pop was going to be a big pop so monetary and fiscal policy began to distort in support of it. Next there was a time when moral hazard became so great that the bubble grew to engulf all policy and media, marginalising an entire generation from home ownership. Politicians routinely lied to cover the collapse in evidence based policy-making.

Finally, we come to today. When notions of managing the macro-economic levers of an economy now boil down to just one thing: • low interest rates to prevent the housing bubble bursting; • fiscal repair to prevent the bubble bursting, and • mass immigration to prevent the bubble bursting even though it is crushing living standards and gutting wages. [..] It’s all so bizarre. All we need to do is cut immigration and let house prices fall. There’ll be a period of adjustment while wages and the currency correct but it won’t be too bad. We’ll still be on the doorstep of Asia. The students and tourists will still come, in greater numbers than ever as we get cheaper, but they’ll also go home not pressuring living standards.

Broader tradables (40% of the economy) will boom. Commodity income will surge, lifting the Budget. Our maginalised youth will have much greater opportunities to advance their global opportunities as Dutch Disease ends. Incomes will ultimately be much more sustainable. Then we can all move on with a much healthier economy, polity, society and strategic outlook. The alternative is to sell our freedom to China, our standards of living to a few rich developers, our politics to carpet baggers and our society to fractious class wars. Just for higher house prices. If a more ignominious fate awaited any nation in history then I’m not aware of it.

America emerged out of darkness and light – a proto-nation clouded by the genocide of native Americans and the enslavement of transshipped Africans but brilliantly shot through with shafts of luminescence – the liberal ideals of European philosophers such as Locke and Hume.The alternate red and white stripes of its flag have thus come to echo a nation born in the blood of its innocent victims yet ennobled, in parallel, by the spirit of the Enlightenment. Yet even after its ideals were enshrined in The Declaration of Independence, The Constitution and the Bill of Rights, the country continued to countenance slavery, the trading of domestic, purpose-bred Africans and the brutal killing of native peoples and their vibrant communities.

Today, the historic and contemporary horrors of the American nation are ground together with its liberal principles (in some mythic bedrock mortar) to produce a culture that proclaims its goodness to its people and to the world, yet is visibly marbled with the evils of state violence against refugees and minorities, the economic oppression of a population paradoxically made comatose through over-consumption and the global havoc wreaked by its Imperial killing machine. It is this grand chiaroscuro that Eugene Jarecki explores in The King, 2018, his new documentary on the life, death and after-life of Elvis Presley, now in select release following its acclaimed debuts at the film festivals in Sundance and Cannes.

Former FBI attorney Lisa Page has reportedly told a joint committee of the House of Representatives that when FBI counterintelligence official Peter Strzok texted her on May 19, 2017 saying there was “no big there there,” he meant there was no evidence of collusion between the Trump campaign and Russia. It was clearly a bad-luck day for Strzok, when on Friday the 13th this month Page gave her explanation of the text to the House Judiciary and Oversight/Government Reform Committees and in effect threw her lover, Strzok, under the bus. Strzok’s apparent admission to Page about there being “no big there there” was reported on Friday by John Solomon in the Opinion section of The Hill based on multiple sources who he said were present during Page’s closed door interview.

Strzok’s text did not come out of the blue. For the previous ten months he and his FBI subordinates had been trying every-which-way to ferret out some “there” — preferably a big “there” — but had failed miserably. If Solomon’s sources are accurate, it is appearing more and more likely that there was nothing left for them to do but to make it up out of whole cloth, with the baton then passed to special counsel Robert Mueller. The “no there there” text came just two days after former FBI Director James Comey succeeded in getting his friend Mueller appointed to investigate the alleged collusion that Strzok was all but certain wasn’t there.

Robert Parry, the late founder and editor of Consortium News whom Solomon described to me last year as his model for journalistic courage and professionalism, was already able to discern as early as March 2017 the outlines of what is now Deep State-gate, and, typically, was the first to dare report on its implications. Parry’s article, written two and a half months before Strzok texted the self-incriminating comment to Page on there being “no big there there,” is a case study in professional journalism. His very first sentence entirely anticipated Strzok’s text: “The hysteria over ‘Russia-gate’ continues to grow … but at its core there may be no there there.”

The British man poisoned with the nerve agent novichok has claimed the substance that killed his girlfriend and left him critically ill came in a bottle disguised as a legitimate perfume in a sealed box. Charlie Rowley claimed his partner, mother-of-three Dawn Sturgess, fell ill within 15 minutes of spraying the bottle, which he said he had found, on to her wrists at his home in Amesbury, Wiltshire. In his first interview since he was discharged from hospital, Rowley told ITV News: “I do have a memory of her spraying it on her wrists and rubbing them together. “I guess that’s how she applied it and became ill.

I guess how I got in contact with it is when I put the spray part to the bottle … I ended up tipping some on my hands but I washed it off under the tap. “It was an oily substance and I smelled it and it didn’t smell of perfume. It felt oily. I washed it off and I didn’t think anything of it. It all happened so quick. “Within 15 minutes, Dawn said she had a headache. She asked me if I had any headache tablets. In that time she said she felt peculiar and needed to lie down in the bath. I went into the bathroom and found her in the bath, fully clothed, in a very ill state.”

Counter-terrorism detectives are working on the theory that the poisoning of Rowley and Sturgess at the end of last month is directly linked to the poisoning of the Russian spy Sergei Skripal and his daughter, Yulia, in Salisbury in March. Experts from the top secret research facility at Porton Down in Wiltshire are trying to establish if the novichok was from the same batch. But if Rowley is correct about the perfume bottle being boxed and sealed, it may undermine the line of inquiry that the novichok that he and Sturgess came into contact with had been discarded by the attackers of the Skripals. It also opens up the possibility that there may yet be more novichok that has not been found in Wiltshire.

In today’s United States, the term “espionage” doesn’t get too much use outside of some specific contexts. There is still sporadic talk of industrial espionage, but with regard to Americans’ own efforts to understand the world beyond their borders, they prefer the term “intelligence.” This may be an intelligent choice, or not, depending on how you look at things. First of all, US “intelligence” is only vaguely related to the game of espionage as it has been traditionally played, and as it is still being played by countries such as Russia and China. Espionage involves collecting and validating strategically vital information and conveying it to just the pertinent decision-makers on your side while keeping the fact that you are collecting and validating it hidden from everyone else.

In eras past, a spy, if discovered, would try to bite down on a cyanide capsule; these days torture is considered ungentlemanly, and spies that get caught patiently wait to be exchanged in a spy swap. An unwritten, commonsense rule about spy swaps is that they are done quietly and that those released are never interfered with again because doing so would complicate negotiating future spy swaps. In recent years, the US intelligence agencies have decided that torturing prisoners is a good idea, but they have mostly been torturing innocent bystanders, not professional spies, sometimes forcing them to invent things, such as “Al Qaeda.” There was no such thing before US intelligence popularized it as a brand among Islamic terrorists.

Most recently, British “special services,” which are a sort of Mini-Me to the to the Dr. Evil that is the US intelligence apparatus, saw it fit to interfere with one of their own spies, Sergei Skripal, a double agent whom they sprung from a Russian jail in a spy swap. They poisoned him using an exotic chemical and then tried to pin the blame on Russia based on no evidence. There are unlikely to be any more British spy swaps with Russia, and British spies working in Russia should probably be issued good old-fashioned cyanide capsules (since that supposedly super-powerful Novichok stuff the British keep at their “secret” lab in Porton Down doesn’t work right and is only fatal 20% of the time).

As the summer holidays begin, many families look forward to breaks away from home, in the UK and abroad. Yet for thousands of families, the six-week school break is characterised not by play schemes and day trips in the sun, but acute financial stress, hunger and malnourishment, due to the absence of free school meals for children on low incomes that costs a family £30-£40 a week. With three million children at risk of hunger during the school holidays, the Trussell Trust has warned that food bank use spikes each summer. And last year, 593 organisations running holiday clubs across the UK provided more than 190,000 meals to over 22,000 school-aged children.

Feeding Britain, the charity set up by two Labour MPs, Emma Lewell-Buck and Frank Field, expects to provide meals for 27,000 children in 79 clubs across England this summer. In pilots in 2017, it provided a total of 43,314 meals in holiday fun clubs across eight areas, including Birkenhead, South Shields and Cornwall, in the summer holidays and October half term. Feeding Britain works with existing local charities, community groups, councils and others in the community providing funding and toolkits on how to run and roll out pilots, and creates networks for practical support. The clubs run in community centres, church halls, schools, children’s centres, libraries and parks, and they host games and activities for children, alongside breakfast, lunches, and lessons about food and nutrition for the young attendees.

A prolonged bull market across stocks, bonds and credit has left a measure of average valuation at the highest since 1900, a condition that at some point is going to translate into pain for investors, according to Goldman Sachs. “It has seldom been the case that equities, bonds and credit have been similarly expensive at the same time, only in the Roaring ’20s and the Golden ’50s,” Goldman Sachs International strategists including Christian Mueller-Glissman wrote in a note this week. “All good things must come to an end” and “there will be a bear market, eventually” they said. As central banks cut back their quantitative easing, pushing up the premiums investors demand to hold longer-dated bonds, returns are “likely to be lower across assets” over the medium term, the analysts said.

A second, less likely, scenario would involve “fast pain.” Stock and bond valuations would both get hit, with the mix depending on whether the trigger involved a negative growth shock, or a growth shock alongside an inflation pick-up. “Elevated valuations increase the risk of draw-downs for the simple reason that there is less buffer to absorb shocks,” the strategists wrote. “The average valuation percentile across equity, bonds and credit in the U.S. is 90%, an all-time high.” A portfolio of 60% S&P 500 Index stocks and 40% 10-year U.S. Treasuries generated a 7.1% inflation-adjusted return since 1985, Goldman calculated – compared with 4.8% over the last century. The tech-bubble implosion and global financial crisis were the two taints to the record.

Low inflation has prevailed in the current period, just as it did alongside economic growth in the 1920s and 1950s, according to the Goldman report. “The worst outcome for 60/40 portfolios is high and rising inflation, which is when both bonds and equities suffer, even outside recessions.” An increase in policy rates triggered by price pressures “remains a key risk for multi-asset portfolios. Duration risk in bond markets is much higher this cycle,” they wrote.

As Goldman observes: “we are closing in on the longest 60/40 bull market in history – there has been no 10% drawdown in real terms since 2009. A passive long-only balanced portfolio has delivered attractive risk-adjusted returns since the 90s. A favourable ‘Goldilocks’ macro backdrop, supported by the ‘Great Moderation’ and the central bank put, has boosted returns in both equities and bonds. However, after the recent ‘bull market in everything’, valuations across assets are as expensive as they have been this century, which reduces the potential for returns and diversification in balanced portfolios. Some more statistics: “We are nearing the longest bull market for balanced equity/bond portfolios in over a century – a simple 60/40 portfolio (60% S&P 500, 40% US 10-year bonds) has not had a drawdown of more than 10% since the GFC trough (8.7 years) and has delivered a 143% return (11% p.a.) since then.”

And when was the last time a balance portfolio had such a tremendous return? Goldman answers again: “The longest run has been during the Roaring 20s, ending with the Great Depression. The second longest run was the post-war ‘Golden age’ in the 50s – the 90s Boom has been in third place but is now fourth, after the current run. In other words, one would have to go back to some time in early 1929 to be looking at the kind of returns that a balanced “60/40” portfolio is generating today. In fact, the current period of staggering returns without a 10% total drawdown is now 8.7 years. How long was the comparable period in the 1928s? 9.1 years. Which means that if history is any guide, the second great depression is just around the corner.

Step One in the Pecking Order Lie is to promote a narrative of trickle-down economics — that making the rich even richer is a good thing for the non-rich. This is exactly what Ben Bernanke is saying here, that the Fed’s extraordinary efforts to prop up the stock market aren’t just good for the rich, but will be good for everyone once the “wealth effect” kicks in and the rich start spending their money. Whenever someone uses the phrase “wealth effect”, they are promoting a trickle-down narrative. How does trickle-down monetary policy work? By spending TRILLIONS of dollars to buy financial assets, the world’s central banks have inflated the prices of ALL financial assets, EVERYWHERE in the world. This is not a secret plan. This is not a hidden agenda. This is the avowed purpose of what central bankers call Large Scale Asset Purchases (LSAPs).

The goal is to force us to “reach for yield”. The goal is to force us to buy more and more risky assets (stocks) at higher and higher prices. The Fed is trying to make the stock market go up. And they’re succeeding. Here’s a great chart from TCW showing how this works. The orange line is the growth rate of the US economy. The blue line is the growth rate of how rich we are. By tripling the stock market, the Fed has made us much richer than our economy has grown … SOOO much richer than our economy has grown. But the goodies of a trebled stock market aren’t evenly distributed. Who owns stocks? If we’re talking about households, leaving aside pension funds and endowments and other institutional investors, it’s the rich, mostly. And that household share of the Central Bankers’ Bubble doesn’t increase linearly with wealth, but exponentially, meaning that the really rich own a lot more stocks than the merely rich, so the really rich have gotten a lot richer than the merely rich.

Here’s a chart from Deutsche Bank showing the impact (it’s a year old, so the effect is even more pronounced today with the stock market 20% higher). Thirty years ago, the non-rich (the bottom 90% of American households by income) owned 35% of American household wealth. Today they own about 22%. Forty years ago, the really rich (the top 1/10th of 1% of American households by income) owned about 7% of American household wealth. Today they, too, own about 22%. Moreover, the gains of the really rich have mirrored the losses of the non-rich, which means that the well-off and merely rich (the remaining 9.9% of American households) haven’t seen much of a change one way or another.

Now this shift in relative wealth of the non-rich and the really rich didn’t start with the Central Bankers’ Bubble and its narrative of trickle-down wealth effects from monetary policy. It started roughly in 1980 with the Reagan narrative of trickle-down wealth effects from fiscal policy. And before we make overly facile comparisons with the 1920s and 1930s, this chart isn’t taking into account pensions and social security and other safety net features of the modern semi-sorta-welfare state. So I don’t know how historically abnormal today’s level of significant wealth inequality might be, whether it’s Louis XVI level inequality or simply robber baron level inequality. But I know that it IS.

Donald Trump doesn’t know what he’s talking about when he decries America’s trade deficits with countries around the world—and that’s not his fault. None of us do. Thanks to offshoring practices like those revealed in the Paradise and Panama Papers, global investment figures are “a big black hole,” says Daniel Haberly, an economic geographer at the University of Sussex. “We don’t really know what the world economy actually looks like. That’s the big burning question for me. We have this picture of what it looks like on paper but in reality it’s probably something completely different.” Look no further than the UK for an example of how crazy investment statistics are. The first name on its list of top foreign direct investors doesn’t surprise—it’s the world’s biggest economy, the United States.

Second place, however, isn’t such a behemoth. According to British government stats, the Netherlands supposedly shoveled £139.8 billion ($186 billion), 28% of its GDP, into the UK in 2015. Anglo-Dutch ties run long and deep, but can a country of just 17 million people really be investing so much cash into Britain alone? Quite simply, no. The Netherlands is not just a smallish European trading nation—it’s also one of the world’s biggest conduits for cash going to and from tax havens. When the British government broke down its FDI statistics this year (chapter 6), it realized that only 34.5% of that money actually came from the Netherlands; much of the rest being from European subsidiaries of big US companies or… from British companies rerouting their money.

One month ago, when the BEA released its first estimate of the hurricane-impacted economy during the third quarter (which came in at a stronger than expected 3.0%) we were surprised to report that according to the Department of Commerce, in the third quarter the biggest driver of marginal spending was car sales (technically Motor Vehicles and Parts), which increased by $15.6 billion to $463.5 billion. Which, as we said at the time and considering recent US and global automakers data, was paradoxical in light of the ongoing decline in overall sales in the second half of 2017, and it was far too early to expect the post-hurricane spending spree. It was also surprising because as Americans splurged on cars, they pulled back on gasoline purchases, which was the single biggest detractor to spending, subtracting a marginal $3.5 billion in PCE, to $283.6 billion.

In any case, we concluded by saying that “we now await for the revisions to this initial estimate over the coming two months, because something tells us that the auto spending spree will be thoroughly revised well lower.” One month later, when the BEA released its second Q3 GDP estimate, it appears we were right: the contribution from motor vehicles was indeed revised lower, but not nearly as dramatically as we expected, only from a marginal increase of $15.6 million to $13.5 million. And yet, many other line items did see a downward revision, which means that something had to increase sharply to compensate for the downward revisions among other spending components.

Sure enough, something did: the old faithful “plug” which has saved the US economy every quarter for the past 4 years: Healthcare, or as it is better known, Obamacare, because with Trump failing to repeal Obama’s signature health law, it means that Healthcare will merrily “contribute to GDP” for years to come, by being the single biggest marginal spending item for the foreseeable future.

Finally, for a comparison of how dramatically the contribution of “Healthcare” was revised higher, here is a chart showing side by side the change in spending among all key line items. One can almost hear the orders “from above” to make GDP 3% or higher at any cost when looking at this chart.

In theory, the global financial system is supposed to help every country gain. Mainstream teaching of international finance, trade and “foreign aid” (defined simply as any government credit) depicts an almost utopian system uplifting all countries, not stripping their assets and imposing austerity. The reality since World War I is that the United States has taken the lead in shaping the international financial system to promote gains for its own bankers, farm exporters, its oil and gas sector, and buyers of foreign resources – and most of all, to collect on debts owed to it. Each time this global system has broken down over the past century, the major destabilizing force has been American over-reach and the drive by its bankers and bondholders for short-term gains.

The dollar-centered financial system is leaving more industrial as well as Third World countries debt-strapped. Its three institutional pillars – the IMF, World Bank and World Trade Organization – have imposed monetary, fiscal and financial dependency, most recently by the post-Soviet Baltics, Greece and the rest of southern Europe. The resulting strains are now reaching the point where they are breaking apart the arrangements put in place after World War II. The most destructive fiction of international finance is that all debts can be paid, and indeed should be paid, even when this tears economies apart by forcing them into austerity – to save bondholders, not labor and industry. Yet European countries, and especially Germany, have shied from pressing for a more balanced global economy that would foster growth for all countries and avoid the current economic slowdown and debt deflation.

After World War I the U.S. Government deviated from what had been traditional European policy – forgiving military support costs among the victors. U.S. officials demanded payment for the arms shipped to its Allies in the years before America entered the Great War in 1917. The Allies turned to Germany for reparations to pay these debts. Headed by John Maynard Keynes, British diplomats sought to clean their hands of responsibility for the consequences by promising that all the money they received from Germany would simply be forwarded to the U.S. Treasury. The sums were so unpayably high that Germany was driven into austerity and collapse. The nation suffered hyperinflation as the Reichsbank printed marks to throw onto the foreign exchange also were pushed into financial collapse. The debt deflation was much like that of Third World debtors a generation ago, and today’s southern European PIIGS (Portugal, Ireland, Italy, Greece and Spain).

One in 10 London families are relying on charity handouts to eat and food banks are facing unprecedented strain in the run-up to Christmas, new figures reveal. One in four London parents worry about being able to afford to feed their children, the research found, while almost one in five have to choose between heating their homes or feeding their family. The exclusive poll, conducted by Kellogg’s to mark the start of The Independent and Evening Standard Help a Hungry Child campaign, exposed the devastating choices facing parents around the country as food banks struggle to keep up with growing demand. At least 146,798 three-day emergency parcels were handed out by Trussell Trust foodbanks in December 2016, a 47% spike compared to the average for the overall 2016/17 financial year, according to the charity.

Children accounted for 61,093 of those affected. Now the charity is warning 2017 could herald an even higher increase, following a 13% surge in food bank usage during the first six months of this year. The figures are revealed as a Labour MP urges the Government to accurately measure the number of people going hungry with a food insecurity bill. Emma Lewell-Buck, a member of the All-Party Parliamentary Group on Hunger, will present the cost-neutral bill to the Commons on Wednesday. It will ask the Government to incorporate questions about how often people go without food into national surveys. She called rising food bank usage a “massive dereliction of state duty” and is urging Theresa May to take urgent action to recognise the scale of the problem.

“They have to admit what everybody already knows that the levels of hunger are far higher than we have realised,” she said. “It is the duty of the state, there is no way food banks should have filled the gap left by the welfare state that this Government has created.” She added: “Now food banks are becoming a pillar of the welfare state and they should not be and they should never have been.” The South Shields MP said getting a measure on the true scale of the numbers going hungry would force the Government into taking a more proactive stance in tackling hunger.

When money is tight eight-year-old Emma’s parents are forced to send their daughter to school, tummy rumbling, without any breakfast. In the evening, she fills up on plain pasta or reduced microwave meals – cheap food her parents can afford. Emma says she often feels too tired to concentrate on her schoolwork. The situation Emma lives with is the devastating reality faced by the 500,000 children across the UK who go to school hungry each day. Eight million people in Britain – the world’s sixth largest economy – are living in food poverty, according to the United Nations (UN). And an estimated 870,000 children in England may be going to bed hungry each night because their parents are unable to provide the meals they need.

But not eating isn’t the only problem – access to nourishing and nutrient-filled food is simply out of reach for thousands of families living on the breadline, with far-reaching consequences for too many of Britain’s children. Dr George Grimble, a medical scientist at University College London, said the situation was “disastrous” for developing children, resulting in malnourishment, obesity and squandered potential. “When people are in poverty they are forced to buy the cheapest foods – filling but nutrient-lacking food,” Dr Grimble told The Independent. “Food poverty in the community overlays to a large extent on disease malnutrition.” More than 60% of paediatricians believe food insecurity contributed to the ill health among children they treat, according to a 2017 survey by the Royal College of Paediatricians and Child Health.

The harrowing hunger stats sit juxtaposed with the fact 100 million tons of food is wasted each year across the EU. More than 400 million meals’ worth of edible food was sent to landfill in 2016 which could have been redistributed to feed hungry people across Britain, according to the Government’s waste advisory body, Wrap.

On the face of it, the Visegrad countries – the Czech Republic, Hungary, Poland and Slovakia – are doing well economically. The data for GDP per head suggest a gradual convergence in living standards with Western Europe. They continue to attract a disproportionate share of inward investment in EU manufacturing, and their integration into EU-wide supply chains helps to explain why they are now collectively Germany’s most important trade partner, ahead of China and the US. But the political situation across the Visegrad is anything but rosy. Voters in all four countries have succumbed to populists. The reasons for this populism are complex, but economics probably provides a bigger part of the explanation than the positive headline numbers suggest.

In 2016, GDP per head in the Visegrad four (adjusted for price differences) ranged from 64% of eurozone levels in Poland to 82% in the Czech Republic. The Czech Republic, Slovakia and Poland have experienced significant convergence in GDP per head with the eurozone over the last ten years (though it should be noted that the dire performance of the eurozone economy over that period was a major reason for this). But what matters to the average person is not GDP growth, but personal income growth, and hence living standards. And here the Visegrad picture is less reassuring. In 2016 worker ‘compensation’ (wages and salaries and other benefits) ranged from just 50% of the eurozone’s in Hungary to 59% in the Czech Republic. And the rate of convergence of compensation with the eurozone average has been slower than the rate of convergence of GDP.

Growth in consumption across the Visegrad countries has lagged behind growth in GDP, resulting in a sharp fall in consumption as a share of overall spending. This has happened in nearly all developed economies over the last decade, but the scale of the decline in all four Visegrad economies has been much greater. Average households have not seen enough of the fruits of economic growth. Those rewards have gone disproportionately to the owners of capital, and in these countries, that tends to mean foreigners. In the Czech Republic, Hungary, and Slovakia, the most important sectors are largely or wholly foreign-owned. The Polish economy is much bigger and more diversified than the other three, but the level of foreign ownership is still very high.

The Greek government has announced it will abide by any EU embargo on Saudi Arabia as it faces criticism over a controversial arms deal, including from its own MPs. As cracks appeared in the leftist-led coalition over the €66m weapons agreement with the kingdom, the administration’s spokesman said Athens would apply the law “by the letter” if EU sanctions were announced. “We are waiting to see the decisions of the European parliament and will act accordingly,” said Dimitris Tzannakopoulos. “The process is frozen.” Mounting tensions within the ruling Syriza party have matched international condemnation of the agreement by human rights groups. Amnesty International has said the munitions could end up being used by the Gulf state in its war against neighbouring Yemen, where civilian populations have borne the brunt of the conflict.

“[We] call on Greece to immediately rescind the sale and transfer of military equipment to Saudi Arabia and to refuse approval of the transport of every type of conventional weapons, ammunitions and war material to point of conflicts in Yemen,” the rights group said. Prominent members of the ruling Syriza party have questioned the morality of selling arms to Saudi Arabia, and on Tuesday the Greek parliament’s military procurements committee also hinted it may scrap the deal. “Greece is a hub of stability, peace and friendship in the greater region and that is what it should be exporting,” the former deputy European affairs minister Nikos Xydakis told the Guardian. “There is no need for this [deal] to go through and frankly when we’re talking about €66m, not €66bn, it isn’t worth the trouble. It’s not the sort of money that will save Greece.”

Greek authorities on Thursday said they have moved a few hundred asylum seekers from the island of Lesvos to the mainland in an effort to ease overcrowding in its camps. Thousands of asylum seekers have become stranded on Lesbos and four other islands close to Turkey since the European Union agreed a deal with Ankara in March 2016 to shut down the route through Greece. “I came to heaven from hell,” said 30-year old Mohammad Firuz, who lived for two months in a state-run camp in Lesvos.

Firuz was among 300 people, many of them women and children, aboard a ferry that reached the port of Piraeus early on Thursday morning. The asylum seekers would be taken to camps and apartments in the mainland, authorities said. Lesvos is now hosting some 8,500 asylum-seekers, nearly three times the capacity of state-run facilities. Violence often breaks out, mainly over delays in asylum procedures and poor living standards. Lesvos residents went on strike earlier this month to protest against European policies they say have turned it into a “prison” for migrants and refugees.

The world’s most widely used insecticide may cause migrating songbirds to lose their sense of direction and suffer drastic weight loss, according to new research. The work is significant because it is the first direct evidence that neonicotinoids can harm songbirds and their migration, and it adds to small but growing research suggesting the pesticides may damage wildlife far beyond bees and other insects. Farmland birds have declined drastically in North America and Europe in recent decades and pesticides have long been suspected as playing a role. The first evidence for a link came in 2014 when a study in the Netherlands found that bird populations fell most sharply in the areas where neonicotinoid pollution was highest, with starlings, tree sparrows and swallows among the most affected.

“The reason our new study is special is this is not a correlation – it is actual experimental evidence,” said Prof Christy Morrissey, at the University of Saskatchewan in Canada, who said the results shocked her. “The effects were really dramatic. We didn’t anticipate the acute toxicity, because the levels [of neonicotinoid] we gave them were so low. Three neonicotinoids were banned from use on flowering crops in the European Union in 2013 due to unacceptable risks to bees and other pollinators and a total outdoor ban is being considered. Canada is also considering a total ban. Neonicotinoids now pollute the environment across the world and pressure is growing to slash pesticide use, which research shows would not reduce food production on almost all farms.

The new research, published in the peer-reviewed journal Scientific Reports, analysed the effect of the neonicotinoid imidacloprid on white-crowned sparrows that migrate from the southern US and Mexico to northern Canada in summer. Birds were given doses equivalent to less than a single corn seed and within hours became weak, developed stomach problems and stopped eating. They quickly lost 17-25% of their weight, depending on the dose, and were unable to identify the northward direction of their migration. “Basically, these birds became lost,” said Morrissey. Control birds that were not exposed to the insecticide were unaffected.

The rubbish washing up on the UK’s beaches is continuing to increase, rising by 10% in 2017, the Marine Conservation Society’s (MCS) annual beach clean has revealed. Much of the waste is plastic, leading the MCS to call on the government to urgently introduce a charge on single-use plastic items, such as straws, cups and cutlery. The chancellor, Philip Hammond, recently announced the government is considering such action. About 12m tonnes of plastic litter enters the oceans every year, killing millions of marine animals. People are also believed to be inadvertently eating the plastic, potentially contaminated with toxic chemicals, via seafood. The MCS beach clean in September saw 7,000 volunteers scour 340 beaches and collect an average of 718 pieces of rubbish every 100 metres.

The survey uses a standard methodology and data from the last decade and shows a rising tide of litter along the coast. Most of the litter is small, unidentifiable fragments of plastic, broken down in the sea from larger objects and often mistaken for food by fish and birds. But 20% of the rubbish is packaging from “on the go” food and drink, such as cups, bottles, cutlery, stirrers and sandwich packets. “Our beach clean evidence shows a shocking rise in the amount of litter this year,” said Sandy Luk, MCS chief executive. “Our oceans are choking in plastic. We urgently need a levy on single-use plastic as a first step.” “We are concerned we are continuing on this upwards trend,” said Lizzie Prior, beach and river clean project officer at the MCS. “Plastic never goes away – it does not decompose. It just goes to smaller and smaller pieces and becomes much more harmful for our marine environment.”

She said the tax on plastic bags introduced in 2015, which has seen their use drop by 85%, had a rapid impact, with the number of bags found on beaches down by 40% since 2014. “It is really fantastic to see that small charge completely changed people’s behaviour,” she said. “A levy [on other single use plastic] would be a fantastic next step.”

Concerns over debris littering the world’s oceans are back in the spotlight after a Canadian fishing crew found a lobster with the blue and red Pepsi logo imprinted on its claw. Trapped in the waters off Grand Manan, New Brunswick, the lobster had been loaded onto a crate to have its claws banded when Karissa Lindstrand came across it. Lindstrand, who drinks as many as 12 cans of Pepsi a day, quickly spotted the resemblance. “I was like: ‘Oh, that’s a Pepsi can,’” she said. On closer look, it seemed more like a tattoo on the claw. “It looked like it was a print put right on the lobster claw.” Neither she or any of the crew had seen anything like it. More than a week after the find, debate has swirled over how it might have come to be: some believe the lobster might have grown around a can that ended up at the bottom of the ocean.

Others speculate that part of a Pepsi box somehow become stuck on the lobster. Lindstrand disputes these theories. The image on the claw was pixelated, she said, suggesting it couldn’t have come from a can. And the image on a Pepsi box is far too large to be what she saw on the claw. The logo looked like it came from a printed picture, but paper would have deteriorated in the ocean. “I’m still trying to wrap my brain around what exactly it was,” she said. The find comes amid growing concerns over the amount of debris accumulating in the world’s oceans. Between 5m and 13m tonnes of plastic leak into the world’s oceans each year to be ingested by sea birds, fish and other organisms, leading the record-breaking sailor Dame Ellen MacArthur to warn that by 2050 the sea could have more plastic in it than fish, by weight.

Syrian military officials appeared to anticipate Thursday’s night raid on Syria’s Shayrat airbase, evacuating personnel and moving equipment ahead of the strike, according to an eyewitness to the strike. Dozens of Tomahawk missiles struck the airbase near Homs damaging runways, towers and traffic control buildings, a local resident and human rights activist living near the airbase told ABC News via an interpreter. U.S. officals believe the plane that dropped chemical weapons on civilians in Idlib Province on Tuesday, which according to the Syrian Observatory for Human Rights killed 86 people, took off from the Shayrat airbase. The attack lasted approximately 35 minutes and its impact was felt across the city, shaking houses and sending those inside them fleeing from their windows. Both of the airport’s major runways were struck by missiles, and some of its 40 fortified bunkers were also damaged.

Local residents say the Russian military had used the airbase in early 2016 but have since withdrawn their officers, so the base is now mainly operated by Syrian and Iranian military officers. There is also a hotel near the airport where Iranian officers have been staying, though it was not clear whether it was damaged. The eyewitness believes human casualties, at least within the civilian population, were minimal, as there was no traffic heading toward the local hospital. [..] Former National Security Adviser and ABC News contributor Richard Clarke said this attack, one of the quickest displays of force by a new president in recent history, is largely “symbolic.”

Following a 2013 chemical weapons attack that killed more than 1400 people outside of Damascus which a U.S. government intelligence assessment concluded likely used a nerve agent, the Obama administration threatened retaliation but ultimately called off planned airstrikes after Assad agreed to turn over the majority of his chemical weapons arsenal to an international watchdog group. Trump has attempted to blame Obama’s “weakness” for the worsening violence in Syria. “This attack on one air base seems more symbolic,” Clarke said. “I think Secretary of Defense [General] James Mattis gave the president a list of options, this being the smallest. It was a targeted attack not designed to overwhelm the Syrian military … I think the president was trying to differentiate himself from his predecessor.”

Please note, many will argue that the p/e ratio on the S&P 500 was higher in 1999 than it is now. However, there’s two problems with the comparison. First, when there is no “e,” price does not matter. Many of the tech stocks in the SPX in 1999 did not have any earnings and never had a chance to produce earnings because many of them went out of business. However – and I’ve been saying this for quite some time and I’m finally seeing a few others make the same assertion – if you adjust the current earnings of the companies in SPX using the GAAP accounting standards in force in 1999, the current earnings in aggregate would likely be cut at least in half. And thus, the current p/e ratio expressed in 1999 earnings terms likely would be at least as high as the p/e ratio in 1999, if not higher. (Changes to GAAP have made it easier for companies to create non-cash earnings, reclassify and capitalize expenses, stretch out depreciation and pension funding costs, etc).

We talk about the tech bubble that fomented in the late 1990’s that resulted in an 85% (roughly) decline on the NASDAQ. Currently the five highest valued stocks by market cap are tech stocks: AAPL, GOOG, MSFT, AMZN and FB. Combined, these five stocks make-up nearly 10% of the total value of the entire stock market. Money from the public poured into ETFs at record pace in February. The majority of it into S&P 500 ETFs which then have to put that money proportionately by market value into each of the S&P 500 stocks. Thus when cash pours into SPX funds like this, a large rise in the the top five stocks by market cap listed above becomes a self-fulfilling prophecy. The price rise in these stocks has nothing remotely to do with fundamentals. Take Microsoft, for example (MSFT). Last Friday the pom-poms were waving on Fox Business because MSFT hit an all-time high.

This is in spite of the fact that MSFT’s revenues dropped 8.8% from 2015 to 2016 and its gross margin plunged 13.2%. So much for fundamentals. In addition to the onslaught of retail cash moving blindly into stocks, margin debt on the NYSE hit an all-time high in February. Both the cash flow and margin debt statistics are flashing a big red warning signal, as this only occurs when the public becomes blind to risk and and bet that stocks can only go up. As I’ve said before, this is by far the most dangerous stock market in my professional lifetime (32 years, not including my high years spent reading my father’s Wall Street Journal everyday and playing penny stocks).

Perhaps the loudest bell ringing and signaling a top is the market’s valuation of Tesla. On Monday the market cap of Tesla ($49 billion) surpassed Ford’s market cap ($45 billion) despite the fact that Tesla delivered 79 thousand cars in 2016 while Ford delivered 2.6 million. “Electric Jeff” (as a good friend of mine calls Elon Musk, in reference to Jeff Bezos) was on Twitter Monday taunting short sellers. At best his behavior can be called “gauche.” Musk, similar to Bezos, is a masterful stock operator. Jordan Belfort (the “Wolf of Wall Street”) was a small-time dime store thief compared to Musk and Bezos. Tesla has never made money and never will make money. Next to Amazon, it’s the biggest Ponzi scheme in U.S. history. Without the massive tax credits given to the first 200,000 buyers of Tesla vehicles, the Company would likely be out of business by now.

There is a really big crisis coming. Think about it this way. After 8 years and a 230% stock market advance the pension funds of Dallas, Chicago, and Houston are in severe trouble. But it isn’t just these municipalities that are in trouble, but also most of the public and private pensions that still operate in the country today. Currently, many pension funds, like the one in Houston, are scrambling to slightly lower return rates, issue debt, raise taxes or increase contribution limits to fill some of the gaping holes of underfunded liabilities in their plans. The hope is such measures combined with an ongoing bull market, and increased participant contributions, will heal the plans in the future. This is not likely to be the case. This problem is not something born of the last “financial crisis,” but rather the culmination of 20-plus years of financial mismanagement.

An April 2016 Moody’s analysis pegged the total 75-year unfunded liability for all state and local pension plans at $3.5 trillion. That’s the amount not covered by current fund assets, future expected contributions, and investment returns at assumed rates ranging from 3.7% to 4.1%. Another calculation from the American Enterprise Institute comes up with $5.2 trillion, presuming that long-term bond yields average 2.6%. With employee contribution requirements extremely low, averaging about 15% of payroll, the need to stretch for higher rates of return have put pensions in a precarious position and increases the underfunded status of pensions. With pension funds already wrestling with largely underfunded liabilities, the shifting demographics are further complicating funding problems.

One of the primary problems continues to be the decline in the ratio of workers per retiree as retirees are living longer (increasing the relative number of retirees), and lower birth rates (decreasing the relative number of workers.) However, this “support ratio” is not only declining in the U.S. but also in much of the developed world. This is due to two demographic factors: increased life expectancy coupled with a fixed retirement age, and a decrease in the fertility rate. In 1950, there were 7.2 people aged 20–64 for every person of 65 or over in the OECD countries. By 1980, the support ratio dropped to 5.1 and by 2010 it was 4.1. It is projected to reach just 2.1 by 2050. The table below shows support ratios for selected countries in 1970, 2010, and projected for 2050:

For the past few years, the housing market has been unbalanced. Strong demand and lean supply keep pushing prices higher and higher. On Wednesday, a fresh piece of data confirmed that trend. The Mortgage Bankers Association’s weekly purchase loan data showed that the average size of a home loan was the largest in the history of its survey, which goes back to 1990. Higher prices have a few different effects on the market. Buyers have to make tradeoffs on the kinds of homes they can afford, or may be shut out of ownership altogether. They may also adjust their borrowing. Larger mortgage sizes may reflect not just more expensive properties, but also more leveraged ones.

The 20% down payment is a relic: the median down payment in 2016 was 10%. For first-time buyers, it was 6%. First-timers and other buyers of less-expensive homes are more leveraged now than they were at the height of the housing bubble a decade ago. Home loan sizes aren’t the only things that have changed in the years since MBA started its survey. Back at the start of the survey, the median mortgage size was only about 3.3 times the median annual income. It’s now over five times as big – though buyers get bigger homes and lower interest rates.

Global debt has climbed at an “eye-watering” pace over the past decade, soaring to a fresh high of £170 trillion last year, according to the Institute of International Finance (IIF). The IIF said total debt levels, including household, government and corporate debt, climbed by more than $70 trillion over the last 10 years to a record high of $215 trillion (£173 trillion) in 2016 – or the equivalent of 325pc of GDP. It said emerging markets posed “a growing source of concern” to financial stability and the global economy as debt burdens in these countries climb at a rapid pace. The IIF data showed the increase was partly driven by a “spectacular rise” in emerging markets, where total debt stood at $55 trillion at the end of 2016, or 215pc of total emerging market GDP.

Debt has risen from $16 trillion in 2006 and $7.4 trillion in 1996. The body, which represents the world’s top financial institutions, said a wave of maturing debt this year presented a “growing refinancing risk”. It estimates that more than $1.1 trillion of emerging market bonds and loans will mature this year, with dollar-denominated debt accounting for a fifth of all redemptions. It said China faced around $40bn of dollar-denominated redemptions this year, while Russia faced redemptions of $20bn. International bodies including the IMF and OECD have warned that rising interest rates in the US could bring an end to an emerging market corporate debt binge as companies in these countries see their debt servicing costs rise in local currency terms. “While risks associated with currency mismatches may not be as acute as during past emerging market debt crises, the overall emerging market debt burden – particularly as global interest rates head higher – is a growing source of concern,” the IIF said in a note.

President Donald Trump and his advisers have vowed to bring back a Depression-era law that would cleave the biggest U.S. lenders in half by separating commercial and investment banking operations. Wall Street doesn’t expect that to happen. After chief economic adviser Gary Cohn reiterated the administration’s stance toward the Glass-Steagall Act in a private meeting with lawmakers on Wednesday, analysts said they viewed any radical regulatory changes as unlikely. Shares of Bank of America and JPMorgan Chase, which would be most affected by the rule, rose Thursday after Bloomberg first reported on Cohn’s comments. Reinstating Glass-Steagall, which was created after the banking crises of the 1930s and repealed in 1999, would require a rewriting of U.S. banking rules. The Dodd-Frank Act took more than a year of work by Congress.

The Trump administration hasn’t put forward a detailed plan and the revisions proposed by House Republicans don’t involve the return of Glass-Steagall. “Anything resembling Glass-Steagall is so far from happening that it’s hard to envision,” said Ian Katz, an analyst at Capital Alpha. “It simply isn’t a priority issue in Congress.” The Republicans who control the House and the Senate want to loosen banking regulations, not make them stricter, Katz wrote. The Republican Party made restoring Glass-Steagall part of its platform, and Trump sometimes criticized the big banks during the campaign, saying “I’m not going to let Wall Street get away with murder.” Since taking office, he’s appointed Cohn and several other former Goldman Sachs bankers to top posts, and said that he’ll look to JPMorgan CEO Jamie Dimon for advice about regulatory reform.

Treasury Secretary Steven Mnuchin said during his confirmation hearing that he opposes the old Glass-Steagall, but supports a “21st Century” version. He didn’t elaborate on what he meant. “If you’ve listened to all the rhetoric on regulation, we’ve no real guidance on where we are going,” said Christopher Wheeler, an Atlantic Equities analyst in London. “The uncertainty is immense and what you have to believe is that things will continue as they are.” The regulation might not mean that commercial and investment banks have to be separated, Cowen Group analyst Jaret Seiberg wrote in a report. Instead, the government could require that broker-dealers be subsidiaries of holding companies, rather than banks, he said. That would mean that the brokerage arm would have to be separately funded. “Cohn was the most likely obstacle within the Trump White House,” Seiberg wrote. “With him supporting Glass-Steagall’s restoration, there is no one in the inner circle left to fight it.”

More uncharted territory. We tend to forget, but for 10 years now they’re grasping in the dark. They have no idea what they do, all they have to go on are outdated textbooks that were flawed to begin with. Time to audit the Fed and then close it.

The Federal Reserve’s coming decision to reduce its massive asset holdings will set off a complex dance with global investors and the U.S. Treasury as it tries to put a final end to policies used to fight the 2007 financial crisis without upending the economy along the way. It is a feat with no clear precedent, according to analysts and officials involved in the process: a central bank trying to squeeze trillions of dollars out of markets it has supported for a decade, and in the process likely pushing up the cost of home buying, corporate finance and an array of other activities. Though final decisions have not been made, the Fed may shift policy as soon as the end of this year, and over 2018 begin pulling anywhere from $20 billion to $60 billion a month out of bond markets, according to a review of current Fed asset holdings.

For several years during the crisis, the Fed added to its holdings of U.S. Treasury bonds and securities backed by home mortgages to the tune of $85 billion a month before the program was slowed. The purchases were an emergency measure made necessary because the Fed’s short-term interest rate – its primary tool to encourage people and businesses to spend and invest – had already been cut to zero. With the economy still in freefall, the asset purchases added to demand for financial securities, and are thought to have held down long-term interest rates in general, a boost to the home-building and other industries in particular. The central bank is already raising its short-term interest rate and has managed a series of increases without slowing the economy. When it starts to scale back the size of its $4.5 trillion stockpile of Treasury bonds and mortgage-backed securities – essentially reversing the purchases it made during the crisis – it will pose a stiff new test of the economy’s resilience.

Italy’s anti-establishment Five Star Movement party plans to introduce online voting and public referendums to increase “democracy and transparency” in the country’s capital. Five Star councillors presented the draft resolution at Rome’s city hall on Monday, where it will be debated. They claimed the proposed ideas would take the city “from Mafia Capitale [the ongoing corruption scandal which has seen dozens of Rome politicians and businessmen put on trial] to direct democracy and transparency in five years”. The ideas suggested included online consultations and participatory budgeting. The latter process would give citizens more say in how Rome money is spent, and has already been introduced by Five Star-led local authorities in some areas, including Mira and Ragusa.

In a blog post, leader Beppe Grillo said that within a year, a Five Star government would introduce public petitions which can be created online and sent directly to the Italian parliament for discussion – a system which already exists in the UK, for example. “It should be the citizens and the local community who govern cities through the Internet, using collective intelligence,” said Grillo. “The web is revolutionizing the relationship between citizens and institutions making direct democracy feasible, as applied in ancient Greece.” Angelo Sturni, one of the councillors behind the proposal, said: “We also want to experiment with electronic voting in referendums, using the American model.” Discontent over widespread corruption in Rome, as revealed in the Mafia Capitale trial, was one of the main factors in Five Star candidate Virginia Raggi’s victory in mayoral elections last June.

When Qatar agreed to buy 24 French Rafale fighter jets in a €6.3 billion contract at the end of April, it represented yet another major success for France’s arms industry, coming hot on the heels of further multi-billion euro sales of Rafales to Egypt and India. The deals have been hailed by Hollande and his government. According to France’s Minister of Defence Jean-Yves Le Drian, in comments made to the Journal du Dimanche newspaper Sunday, the Qatar contract brought the value of the country’s arms exports to more than €15 billion this year so far. That sum is already more than the €8.06 billion for the whole of 2014, which itself was the highest level seen since 2009 – suggesting a continued upward trajectory for the French arms trade and one that is providing a much-needed salve to the country’s economic woes.

But some of these deals have raised more than a few eyebrows, with anti-arms trade campaigners critical of France’s willingness to sell weapons to countries with less than stellar human rights records. These concerns are only set to rise when Hollande heads first to Doha on Monday and then Saudi Arabia’s capital of Riyadh the day after, where furthering the recent success of the French arms industry is likely to be one of his top priorities. Saudi Arabia has already proved a lucrative trading partner for French arms manufacturers, most recently in a deal signed in November that saw the kingdom buy $3 billion-worth (€2.7 billion) of French weapons and military equipment to supply the Lebanese army. The oil-rich country is currently on something of an arms spending spree. Last year, the Saudis surpassed India to become the world’s biggest arms importer, upping its spending by 54% to €5.8 billion, according to a report by industry analyst IHS.

France, thanks to some adept diplomatic manoeuvering in recent years, is well placed to take advantage of the Saudi cash cow. Paris has been an increasingly close ally of Riyadh ever since it was among the most vocal in backing military intervention against Syria’s President Bashar al-Assad, a key ally of Shiite Iran – one of Sunni Saudi Arabia’s main regional rivals. “You’re seeing political fractures across the region, and at the same time you’ve got oil, which allows countries to arm themselves, protect themselves and impose their will as to how they think the region should develop,” Ben Moores, author of the IHS report, told AP in March. France, of course, is not alone in striking lucrative arms deals in the region. The US remains the biggest arms exporter to the Middle East, with $8.4 billion (€7.5 billion) worth of weapon sales in 2014, while the UK and Germany are also major players.

Last year, the World Bank revised its position on conflict – upgrading it from being one of many drivers of suffering and poverty, to being the main driver. In Somalia, despite some political progress the conflict has put more than half the population in need of assistance, with 363,000 children suffering acute malnutrition. In north-east Nigeria, conflict with Boko Haram has left 1.8m people still displaced, farmers unable to grow crops, and 4.8 million people need food. In Yemen, an escalation in conflict since 2015 has worsened a situation already made dire by weak rule of law and governance. Now more than 14 million people need food aid. Only if we understand conflict can we understand hunger. South Sudan is another example. I worked there for two years following the signing of the comprehensive peace agreement in 2005.

Right now a place called Koch, where Mercy Corps works, is in what the famine early warning systems network calls a “level 4 emergency phase”. This means that people will start to die of hunger in a matter of months if they don’t receive enough aid. Until recent years, Koch was a thriving community with fertile land. It has been destroyed in armed clashes since conflict broke out in South Sudan in December 2013. Families have had to move time and time again and disease is rampant due to the lack of clean water. As one father of five told our team in Koch: “My house was burnt, everything was looted and I do not know how to rebuild my life.” Across the places where we work and where people are facing starvation, the pattern is the similar.

Hunger is not some freak environmental event; it is human-made, the result of a deadly mix of conflict, marginalisation and weak governance. Yet watching some of the news and the crisis appeals, one could be forgiven for thinking that what we need is another Live Aid song and airdrops of food. Red Nose Day has been criticised for portraying Africa as a place where “nothing ever grows”. A recent social media campaign to send a plane filled with food to Somalia gathered support: a noble gesture, but not a long-term solution. Mercy Corps’ own emergency response is not the long-term answer either.

Kostas Argyros’s unpaid electricity bills are piling up, among a mountain of debt owed to Greece’s biggest power utility. His family owe €850 to the Public Power Corporation (PPC), a tiny fraction of the state-controlled firm’s 2.6 billion euros ($2.8 billion) in unpaid bills. Argyros picks up only occasional work as an odd-job man. “When you only work once a week, what will you pay first?” said the 35-year-old, who lives in a tiny apartment in an Athens suburb with his unemployed wife and four small children. The Argyros family are emblematic of deepening poverty in Greece following seven years of austerity demanded by the country’s international creditors. They burn wood to heat their home in winter, food is cooked on a small gas stove, and hot water is scarce.

The only evening light is the blue glare of a TV screen, for fear of racking up more debt. Five-watt lightbulbs provide a dim glow and Argyros worries about the effect on their eyesight. More than 40% of Greeks are behind on their utility bills, higher than anywhere else in Europe. People in poor neighborhoods are also increasingly turning to energy fraud, meaning that the problem for PPC is much higher than the mountain of unpaid bills suggests. Power theft is costing PPC around €500-600 million a year in lost income, an industry official said, requesting anonymity because he was not authorized to divulge the numbers. Public disclosures by the Hellenic Electricity Distribution Network Operator HEDNO, which checks meters, show that verified cases of theft climbed to 10,600 last year, up from 8,880 in 2013 and 4,470 in 2012.

Authorities believe theft is far higher than the cases verified by HEDNO, another official said, declining to be named. Households in the country are equipped with analog meters, which are easy to hack. One of the most common tricks is using magnets, which slow down the rotating coils to show less consumption than the real amount, a HEDNO official said. Some websites even offer consumers tips and tricks on power fraud. For households who have had their electricity cut off, a group of activists calling themselves the “I Won’t Pay” movement have taken it upon themselves to reconnect the supply. The group says it has done hundreds this year. PPC, which has a 90% share of the retail market and 60% of the wholesale market, is supposed to reduce this dominance to less than 50% by 2020 under Greece’s third, 86 billion euro bailout deal.

It’s time to make this personal. Against Schäuble and Dijsselbloem, Merkel and Rutte and Hollande. They are killing people. There’s nothing innocent about that. Making it personal is the only thing that’ll work. Bring it to their doorstep. Literally to their doorstep.

On the morning of April 4, 2012, a gunshot sounded amid the city’s hustle and bustle. As passers-by rushed to work through Syntagma Square in central Athens, Dimitris Christoulas had taken his life with a shotgun a few metres from the Greek parliament. The 77-year-old pensioner, a former pharmacist, had left a note in his pocket. “The occupation government literally annihilated my ability to survive,” he wrote. “I depended on my decent pension, which I alone and without the support of the state, paid for 35 years.” His only daughter, Emmy Christoula, had known nothing about his plans. But, speaking as the fifth anniversary of his death approached, she confidently described her father’s public suicide as a political act. Her father woke up in the morning, got dressed, and wrote two identical notes – putting one in his pocket and leaving the other on his kitchen table for his daughter to read.

He took the subway to the square, site of the country’s most important protests for more than a century. When Dimitris arrived at Syntagma, he texted his daughter – “It’s the end, Emmy,” he wrote – and switched off his phone. Greek morning television talk shows broke the news of Christoulas’s suicide a few minutes after it happened. Hundreds soon gathered to pay their respects. Flowers, letters and notes of resistance were left by the tree where he chose to take his life. Spaniards wrote songs of his resistance. Irish poets wrote odes to him. His funeral turned into a rally against the austerity measures imposed on Greece, when the country’s debt payments became too onerous to pay amid the worldwide recession. The country’s creditors called for harsh spending cuts and steep tax increases so that Athens could make the payments. Protests and riots became a staple of life in Athens in the years that followed.

Five years on from Christoulas’ suicide, the crisis has only grown deeper. Greece’s debt is 175% of its GDP. Greek officials have cut retirees’ pensions 17 times to around half of their value before the recession, according to the Greek Association of Pensioners. Budget cuts have also been implemented in education, health, and welfare services. Lenders must improve most government decisions. Unemployment stands at more than 23%. A fourth bailout agreement is expected soon. According to the Greek Statistical Service, suicides have increased by 68% since 2008, the first year Greek economic growth stagnated. “I’m of a certain age and don’t have the power of dynamically reacting,” wrote Christoulas in his suicide note. “I can’t find another solution to a dignified end, as soon I’d have to start scavenging through the garbage to find my own food.”

Christoulas’ suicide became a symbol of the devastating effects of austerity on the Greek people. Until then, the majority of the stories published in the international media on the issue were about lazy Greeks who deserved their comeuppance for living off debt for so many years. “[My father] taught me that you shouldn’t just follow history, you should write it,” said Emmy, adding that she has accepted her father’s decision but still aches from his absence. Emmy describes her father as a wiry and lean man who had long participated in public life. Her first childhood memories include sitting on his shoulders at pro-democracy rallies against Greece’s military government in the 1970s. The police brutality didn’t deter father and daughter from participating.

China’s GDP grew at 6.7% year on year in the second quarter of 2016, at least officially. However, most analysts don’t believe the official figures. “The official figure is still around 7%, but those data are made in the statistical kitchen,” says Willem Buiter, the chief economist of Citigroup. He thinks China is not growing at more than 4%. After reporting 6.7% growth over the year in the first quarter of 2016, analysts were looking for 6.6% growth in the second quarter compared to the second quarter of 2015, so China managed to engineer a small beat and create the illusion of stability. Quarterly growth even picked up from 1.1% in the first quarter to 1.8% in the second quarter.

“The speed of growth that it points to is increasingly hard to believe given the clear structural drags that the economy is facing,” research firm Capital Economics writes in a note. The analysts think China grew 4.5% based on a proprietary activity index, roughly the same as in the first quarter. Private investment was the biggest drag on growth, it just expanded 1% in May, down from 15% in early 2015. State companies have picked up the slack. A survey of thousands of companies by the China Beige Book (CBB) released earlier in July paints a similar picture. CBB says most indicators improved in the second quarter, although activity is roughly flat over the year. In most cases, less than 50% of survey respondents report an improvement in sales, hiring, capital expenditure, or bank lending.

Asian shares extended gains to eight-month highs on Friday, on track for a solid weekly rise, as better-than-expected economic data from China lifted risk sentiment that was already buoyant after record highs on Wall Street. China’s economy grew 6.7% in the second quarter from a year earlier, steady from the first quarter and slightly better than expected as the government stepped up efforts to stabilize growth in the world’s second-largest economy.

Industrial output and retail sales also beat forecasts, which helped alleviate fears of slowing momentum, though fixed-asset investment growth slipped and missed market expectations. “The data showed the signs of stabilisation, which is very encouraging,” said Julian Wang, economist for Greater China at HSBC. “However, public sector investment and housing market are slowing down. So the challenges still loom quite large in the second half of the year.”

China’s economic roller coaster is taking a bite out of American exporters, hurting U.S. industries ranging from mining equipment to cotton producers and adding to criticism that China is getting more than it gives in trade with the U.S. The U.S. shipped just $42.4 billion to China in the first five months of the year, or 8.2% less than the year-earlier period and 13.8% below the peak export year of 2014, according to the Census Bureau. The export drop comes as China’s economy, while slowing, is still officially expanding at more than 6% a year. That growth is driven in part by the mountain of goods—worth $174 billion so far this year—the U.S. imports from China. That is quadruple the size of its exports to China during those months, and only slightly less than 2014 levels.

The slowdown in U.S. exports could exacerbate accusations in the 2016 presidential campaign that China is engaged in unfair trade practices. Donald Trump, the presumptive Republican nominee, has cited the trade gap with China in threatening to slap new tariffs on the country if he becomes president. U.S. companies have grown increasingly vocal in criticizing Beijing for allegedly dumping subsidized steel and other products on world markets and for refusing to open major parts of its economy to foreign investment—a roadblock that almost certainly hinders two-way trade.

[..] M5S’s Luigi Di Maio, who, polls show, has a very good chance of succeeding Renzi as prime minister, has reiterated his party’s long-standing call for a referendum on the euro: “We want a consultative referendum on the euro. The euro as it is today does not work. We either have alternative currencies or a ‘euro 2.’ We entered the European Parliament to change many treaties. The mere fact that a country like Great Britain even held a referendum on whether to leave the EU signals the failure of the European Union.” A referendum on the euro would be “consultative” because Italian law does not allow such plebiscites to change international treaties, including those that involve Italy’s relations with the European Union.

But Grillo is seeking a legislative change to allow an “ad hoc” exception, similar to the one in June 1989, when Italy held a consultative referendum on whether to transfer certain powers to the European Parliament. The exception would presumably be approved if M5S wins the prime minister’s office. Meanwhile, analysts are warning that the turmoil in Italy could spread to the rest of the eurozone. The risk of contagion is due to the so-called “doom loop” that exists between European governments and European banks, which have more than doubled the holdings of their own governments’ debt from a low of €355 billion in September 2008 to €791 billion today. International banks have lent Italy more than €500 billion, according to Die Welt, which reports that French banks alone hold €250 billion of Italian debt.

German banks hold €84 billion of Italian bonds. The only question, according to analysts, is whether taxpayers or bondholders will be left holding the tab. Wolfgang Münchau warned of the consequences of a disorderly Italian exit from the euro: “An Italian exit from the single currency would trigger the total collapse of the eurozone within a very short period. It would probably lead to the most violent economic shock in history, dwarfing the Lehman Brothers bankruptcy in 2008 and the 1929 Wall Street crash.” As Ambrose Evans-Pritchard of the Telegraph has pointed out, however, Italy must choose between the euro and its own economic survival. Leaving the euro “may be the only way to avert a catastrophic deindustrialization of the country before it is too late.”

The idea of modern banking was born in Siena in 1624, when the Medici Grand Duke decided to guarantee accounts held at Monte dei Paschi, the world’s oldest bank, with the proceeds of pasture he held in the Maremma in south-western Tuscany. Nearly 400 years later, the principle established by the Tuscan ruler – that account holders and investors are protected by the state – lies at the heart of a crisis at Monte dei Paschi di Siena (MPS) that is worrying financial markets around the world. The country’s third-largest lender has already been bailed out twice in modern Italian history but is likely to need a third multibillion-euro intervention by the Italian government – a move that would need Brussels to break new rules designed to prevent such taxpayer bailouts after the 2008 global financial crisis.

So the question of who will pay for the inevitable rescue of MPS, whose share value has fallen 80% over the past year, has yet to be answered. Three weeks after the news that Britain has voted to leave the European Union shocked the markets, a debate over the fate of MPS and the economic and political repercussions of inaction is raging from Rome to Brussels and Paris to Berlin. The welfare of thousands of Italian households is at stake, as well as the political fortune of Italy’s prime minister, Matteo Renzi, who is facing the toughest political challenge of his career. It is also testing Italy’s credibility among foreign investors. “There is no way they will let the bank go and create a systemic effect,” said Wolfango Piccoli, co-president of Teneo Intelligence. “The mechanics are still unclear but there will be a third bailout of Monte dei Paschi.”

[..] Unlike the US, Spanish and Irish financial crises, the Italian banking crisis is not the result of a speculative property bubble. While other issues have exacerbated the turmoil at Monte dei Paschi’s – including a poorly judged €9bn acquisition – the primary reason the bank is in trouble is because it doled out billions of euros in loans to small businesses at a time when the scale of the recession facing Italy was gravely underestimated. From 2007 to 2013, Italy lost about a quarter of its industrial production and tens of thousands of companies collapsed. In 2013 more than 150 shops closed every day. Construction and home sales slumped and none of the sectors has recovered fast enough.

With the market breaking out to all-time highs, the media has started to once again reach for their party hats as headlines suggest clear sailing for investors ahead. While I certainly do not disagree the breakout is indeed bullish, and signals a continuation of the long-term bullish trend, there are more than sufficient reasons to remain somewhat cautious. Earnings are still weak, there is little evidence of economic resurgence and inflationary pressures globally remain nascent. But, for now, a rash of global Central Banks continue to support asset prices by increasing accommodative policies either through additional reductions in interest rates or direct injections of liquidity. As Matt King from Citi recently noted: “It has been a surge in net global central bank asset purchases to their highest level since 2013.”

With the ECB in full QE mode, the BOC now using $300 billion in Pension Funds to prop up prices, and the BOJ now moving towards an additional $130 billion in QE as well, the liquidity push continues. Interestingly, despite the push by Central Banks to loft asset prices higher, individual market participants as measured by the Investment Company Institute (ICI) have a different idea. As shown in the chart below, despite asset prices ringing all-time highs, net equity inflows have turned decisively negative. This was much the same case following the 2012 market rout and it wasn’t until the launch of QE3 in 2013 that investors began to once again chase the markets.

Canadian new home prices in May grew at their fastest pace in almost nine years, soaring 0.7% from April on strength in the booming markets of Toronto and Vancouver, Statistics Canada said on Thursday. Analysts polled by Reuters had predicted a 0.2% advance. May’s increase was the largest since the 1.0% jump recorded in July 2007. The Liberal government is concerned about rapidly rising prices in Toronto and Vancouver and is mulling more restrictions on mortgages. The combined region of Toronto and Oshawa – which accounts for 27.92% of the entire Canadian market – posted a 1.9% gain, the highest in 27 years.

Builders cited market conditions and the price of land. Market conditions also helped drive up new home prices in Vancouver by 1.1%. Overall, housing prices increased by 2.7% from May 2015, the largest year-on-year rise since the 2.7% advance seen in September 2010. The new housing price index excludes apartments and condominiums, which the government says are a particular cause for concern and which account for one-third of new housing.

Government attempts to stop the UK property market being exploited by international money launderers are “totally inadequate” and the country has instead “laid out a welcome mat” to criminals, the House of Commons home affairs committee has said. The influential panel of MPs, chaired by the Labour backbencher Keith Vaz, said it was disgraceful that at least £100bn was being laundered through the UK every year and astonishing that just 335 out of 1.2m property transactions last year were deemed to be suspicious by law enforcement officials. That means only 0.01% of the 2.4 million buyers and sellers in the UK generated suspicious activity reports at the National Crime Agency (NCA), whose system, Vaz said, was not fit for purpose.

“The proceeds of crime legislation has failed,” Vaz said. “London is a centre for money laundering, and its standing as a global financial centre is dependent on proactively and effectively tackling money laundering. Investment in London properties is a major route which tarnishes the image of the capital. Supervision of the property market is totally inadequate.” The NCA’s system gathers suspicious activity reports from lawyers, accountants, bankers and other professionals but is overwhelmed with more than 380,000 reports per year, when it is designed to handle 20,000. [..] The MPs said it remained “far too easy for someone intent on laundering money to buy a property with their ill-gotten gains, and rent it out in a very buoyant and robust letting market and take in clean money in perpetuity”.

The IMF is getting nervous, and what it appears to be most concerned about, is a collapse of the status quo. Moments ago, in a speech in Washington, IMF head Christine Lagarde said that “The greatest challenge we face today is the risk of the world turning its back on global cooperation—the cooperation which has served us all well. We know that globalization – and increased integration – over the past generation has yielded many economic benefits for many people.” The IMF is not alone: for years, consultancy giant McKinsey towed the party line as well saying in 2010 that “the core drivers of globalization are alive and well” and adding as recently as 2014 that “to be unconnected is to fall behind.”

That appears have changing, and cracks are starting to form behind the cohesive push for globalization, at least among those who benefit the most from globalization. In a stunning study released today, one which effectively refutes all its prior conclusions on the matter, McKinsey slams the establishment’s status quo thinking and admits that the economic gains of changes in the global economy have not been widely shared lately, especially in the developed world. In the report titled “Poorer Than Their Parents? Flat or Falling Incomes in Advanced Economies” it finds that prospects for income growth have deteriorated significantly since the financial crisis, and that the benefits from globalization are now over:

This overwhelmingly positive income trend has ended. A new McKinsey Global Institute report finds that between 2005 and 2014, real incomes in those same advanced economies were flat or fell for 65 to 70% of households, or more than 540 million people. And while government transfers and lower tax rates mitigated some of the impact, up to a quarter of all households still saw disposable income stall or fall in that decade.

As Bloomberg reports, Britain’s vote to exit the European Union exemplifies what happens when people feel like the system is letting them down, Richard Dobbs, the co-leader of the research, said in an interview Wednesday, ahead of the report’s release. He likened the buildup of resentment over globalization to a dangerous natural gas leak in a row of houses. “One of them will explode. I did not think that it would be the U.K. first,” said Dobbs, a senior partner of McKinsey and a member of the McKinsey Global Institute Council in London. “When we launch a new policy, let’s think about the impact on those groups” who have been left behind, Dobbs said. Sometimes the goals of fairness and efficiency can conflict, he said. “Are we prepared to damage competitiveness a bit to reduce the risk of an explosion?”

The globalists have used the method of false dichotomies for centuries to divide nations and peoples against each other in order to derive opportunity from chaos. That said, the above dichotomy is about as close to real as they have ever promoted. As I explained [earlier], the recent passage of the Brexit referendum in the U.K. has triggered a surge of new propaganda from establishment media outlets. The thrust of this propaganda is the notion that “populists” are behind the fight against globalization and these populists are going to foster the ruin of nations and the global economy. That is to say – globalism good, populism bad. There is a real fight between globalists and those who desire a free, decentralized and voluntary society.

They have just changed some of the labels and the language. We have yet to see how effective this strategy will be for the elites, but it is very useful for them in certain respects. The wielding of the term “populist” is about as sterilized and distant from “freedom and liberty” as you can get. It denotes not just “nationalism,” but selfish nationalism. And the association people are supposed to make in their minds is that selfish nationalism leads to destructive fascism (i.e. Nazis). Therefore, when you hear the term “populist,” the globalists hope you will think “Nazi.” Also, keep in mind that the narrative of the rise of populism coincides with grave warnings from the elites that such movements will cause global economic collapse if they continue to grow.

Of course, the elites have been fermenting an economic collapse for years. We have been experiencing many of the effects of it for some time. In a brilliant maneuver, the elites have attempted to re-label the liberty movement as “populist” (Nazis), and use liberty activists as a scapegoat for the fiscal time bomb THEY created. Will the masses buy it? I don’t know. I think that depends on how effectively we expose the strategy before the breakdown becomes too entrenched. The economic collapse itself has been handled masterfully by the elites, though. There is simply no solution that can prevent it from continuing. Even if every criminal globalist was hanging from a lamp post tomorrow and honest leadership was restored to government, the math cannot be changed and decades of struggle will be required before national economies can be made prosperous again.

Every totalitarianism starts as distortion of language, as in the novel by George Orwell. Neoliberalism has its Newspeak and strategies of communication that enable it to deform reality. In this spirit, every budgetary cut is represented as an instance of modernization of the sectors concerned. If some of the most deprived are no longer reimbursed for medical expenses and so stop visiting the dentist, this is modernization of social security in action! Abstraction predominates in public discussion so as to occlude the implications for human beings. Thus, in relation to migrants, it is imperative that the need for hosting them does not lead to public appeals that our finances could not accommodate. Is it In the same way that other individuals qualify for assistance out of considerations of national solidarity?

Social Darwinism predominates, assigning the most stringent performance requirements to everyone and everything: to be weak is to fail. The foundations of our culture are overturned: every humanist premise is disqualified or demonetized because neoliberalism has the monopoly of rationality and realism. Margaret Thatcher said it in 1985: “There is no alternative.” Everything else is utopianism, unreason and regression. The virtue of debate and conflicting perspectives are discredited because history is ruled by necessity. This subculture harbours an existential threat of its own: shortcomings of performance condemn one to disappearance while at the same time everyone is charged with inefficiency and obliged to justify everything. Trust is broken. Evaluation reigns, and with it the bureaucracy which imposes definition and research of a plethora of targets, and indicators with which one must comply. Creativity and the critical spirit are stifled by management.

Can a stretch of land be a person in the eyes of the law? Can a body of water? In New Zealand, they can. A former national park has been granted personhood, and a river system is expected to receive the same soon. The unusual designations, something like the legal status that corporations possess, came out of agreements between New Zealand’s government and Maori groups. The two sides have argued for years over guardianship of the country’s natural features. Chris Finlayson, New Zealand’s attorney general, said the issue was resolved by taking the Maori mind-set into account. “In their worldview, ‘I am the river and the river is me,’” he said. “Their geographic region is part and parcel of who they are.”

From 1954 to 2014, Te Urewera was an 821-square-mile national park on the North Island, but when the Te Urewera Act took effect, the government gave up formal ownership, and the land became a legal entity with “all the rights, powers, duties and liabilities of a legal person,” as the statute puts it. “The settlement is a profound alternative to the human presumption of sovereignty over the natural world,” said Pita Sharples, who was the minister of Maori affairs when the law was passed. It was also “undoubtedly legally revolutionary” in New Zealand “and on a world scale,” Jacinta Ruru of the University of Otago wrote in the Maori Law Review.

Personhood means, among other things, that lawsuits to protect the land can be brought on behalf of the land itself, with no need to show harm to a particular human. Next will be the Whanganui River, New Zealand’s third longest. The local Maori tribe views it as “an indivisible and living whole, comprising the river and all tributaries from the mountains to the sea — and that’s what we are giving effect to through this settlement,” Mr. Finlayson said. It is expected to clear Parliament and become law this year.

Looks like we’re finally getting GMO labels on food products—just not the kind you can actually read. President Obama is expected to throw his weight behind a controversial bill that allows businesses to use a smartphone scannable QR code instead of clear, concise wording that informs consumers if a product contains genetically modified ingredients. The bill would also nullify state-by-state GMO labeling mandates such as Vermont’s landmark law that took effect on July 1. “While there is broad consensus that foods from genetically engineered crops are safe, we appreciate the bipartisan effort to address consumers’ interest in knowing more about their food, including whether it includes ingredients from genetically engineered crops,” White House spokeswoman Katie Hill told Bloomberg in an e-mail.

“We look forward to tracking its progress in the House and anticipate the president would sign it in its current form.” The House of Representatives is voting today on legislation from the Senate, which voted 63 to 30 in favor of the bill on July 7, less than a week after Vermont enacted its GMO label law. The bipartisan “compromise” bill was conceived after years of negotiations by Democrat Sen. Debbie Stabenow and Republican Sen. Pat Roberts and is supported by the very industry that produces and profits from such products, including the powerful Grocery Manufactures Association and world’s largest seed producer and pesticide giant Monsanto. UPDATE: The U.S. House of Representatives passed the bill by a 306-117 vote Thursday. The bill now heads to President Obama’s desk.

The variety of animals and plants has fallen to dangerous levels across more than half of the world’s landmass due to humanity destroying habitats to use as farmland, scientists have estimated. The unchecked loss of biodiversity is akin to playing ecological roulette and will set back efforts to bring people out of poverty in the long term, they warned. Analysing 1.8m records from 39,123 sites across Earth, the international study found that a measure of the intactness of biodiversity at sites has fallen below a safety limit across 58.1% of the world’s land. Under a proposal put forward by experts last year, a site losing more than 10% of its biodiversity is considered to have passed a precautionary threshold, beyond which the ecosystem’s ability to function could be compromised.

“It’s worrying that land use has already pushed biodiversity below the level proposed as a safe limit,” said Prof Andy Purvis, of the Natural History Museum, and one of the authors. “Until and unless we can bring biodiversity back up, we’re playing ecological roulette.” Researchers said the study, published in the journal Science on Thursday, was the most comprehensive examination yet of biodiversity loss. The decline is not just bad news for the species but in the long term could spell problems for human health and economies. “If ecosystem functions don’t continue, then yes it affects the ability of agriculture to sustain human populations and we simply don’t know at which point that will be reached,” said Dr Tim Newbold, lead author of the work and a research associate at University College London. “We are entering the zone of uncertainty.”

Under a blazing Catalan sun, Abdelouahid wipes the sweat from his brow in a cabbage patch full with clouds of white butterflies. “It’s really not warm today,” he says. “It’s only hot if you stop working.” Around him, unemployed workers and environmentalists squat in green bibs, black gloves and hats, plucking cabbages that would otherwise be threshed, to distribute at food banks around Barcelona. A 39-year-old Moroccan emigré with two small children, Abdelouahid began “gleaning” – harvesting farmers’ unwanted crops – with the Espigoladors (gleaners) after losing his job in the construction industry four years ago. It is Ramadan and he is fasting but still smiling as he cuts at the green jewels.

“I don’t like to spend my days at home, sending CVs to employers, waiting for their rejection letters, or going around the restaurants trying to find food,” he says. “I prefer to do something positive. A lot of people need this food. It is better to collect it than to leave it.” Europe wastes some 88m tonnes of food each year – around 173 kg per person – with costs estimated at €143bn (£113bn). Advocates of the new gleaning movements say that its collection could reduce pressure on land use, improve diets, feed the hungry and provide work for the socially excluded.

For now, most of its recovered foods go to food banks, but the Espigoladors social enterprise has launched an “Es Imperfect” (is imperfect) brand of jams, soups and sauces made from recovered produce. The line is growing so fast that the day after the cabbage picking, the project’s founder, Mireia Barba, was called to a meeting of Cotec, King Felip VI’s national development foundation. Another fruit of the gleaning project has been an “I’m imperfect too” advertising campaign which challenges conventional ideas of food and beauty, by using photos of ordinary people holding painted fruit. The idea was to change misconceptions about browned, soft or unusually shaped fruit and veg being any less tasty.

Finance chiefs from the world’s biggest developed economies meeting in Japan underscored concerns that global growth is flagging and reaffirmed a pledge not to deliberately weaken their currencies, even as Japan again warned on the yen’s surge. At the end of two days of talks, Group of Seven central bank governors and finance ministers highlighted risks from terrorism, refugee flows, political conflicts and the potential for a U.K. exit from the EU. While officials agreed not to target currencies to stoke growth and warned of the negative consequences from disorderly moves in exchanges rates, host Japan repeated a stance that recent trading in the yen has been one sided and speculative.

Comments on the yen’s moves by Finance Minister Taro Aso hint at a growing frustration inside Japan’s government about the impact on exporters after the currency surged 9% this year, spurring speculation that the government may intervene. Aso raised the issued in a meeting with U.S. Treasury Secretary Jacob J. Lew on Saturday. “I told him that one-sided, abrupt, and speculative moves were seen in the FX market recently, and abrupt moves in the currency market are undesirable and the stability of currencies is important,” Aso said to reporters. Tensions over the yen were evident over the course of the meetings, which were held at a hot springs resort in the country’s north. As Japan warned about the impact of disorderly trading, Lew repeated his view that the yen’s movement hasn’t been overly volatile.

“It’s a pretty high bar to have disorderly conditions,” Lew told reporters. To be sure, Japan remains a long way from its first intervention since 2011, when the G-7 sanctioned selling the yen to aid the country’s recovery after a devastating earthquake, tsunami and nuclear meltdown. A strengthening dollar amid rising bets that the Federal Reserve may lift interest rates over coming moths is helping ease pressure on Japan’s exporters. Aso also made it clear that the difference of opinion with the U.S. is manageable. “They have an election and we have an election and we both have TPP talks,” Aso said. “There are various things on our plates and we of course have to say various things as that’s our jobs.”

Still, by choosing to be so vocal on the yen, Aso is both attempting to jawbone the currency lower and put a marker down in the event the currency again starts to appreciate rapidly. “There’s no sign that Japan and the U.S. will move closer together,” said Hiroaki Muto, chief economist at Tokai Tokyo Research Center.

Left, right, everyone wants growth. But what if that is quite literally a broken record? What if the ‘New Economics’ should be one that questions perpetual growth? After all, growth is no more than an assumption, and there are others.

Jeremy Corbyn said the UK needed a serious debate about wealth creation, as he called for a new style of economics to tackle Britain’s “grotesque inequality”. Closing a Labour state of the economy conference in central London on Saturday, the party’s leader said: “Wealth creation is a good thing: we all want greater prosperity. But let us have a serious debate about how wealth is created, and how that wealth should be shared.” Corbyn also said a Labour government would “chase down the tax avoiders and the tax evaders” and ensure HMRC had the resources it needed to do so. Labour needed to be ambitious and bold to win the next election, he said. In the meantime, he insisted that the party could make a difference despite the frustrations of being in opposition.

“We must continue to stand up against the Conservative six-year record of mismanagement of the economy – and stand up for the vital services on which we all depend.” George Osborne had vowed six years ago that austerity would wipe out the deficit, Corbyn said. “That’s the wonderful thing about George Osborne’s five-year plans: they’re always five years away,” he added. Shopfloor workers, entrepreneurs and technicians should be put in the driving seat, the Labour leader said. “We want to see a genuinely mixed economy of public and social enterprise, alongside a private sector with a long-term private business commitment, that will provide the decent pay, jobs, housing, schools, health and social care of the future. Labour will always seek to distribute the rewards of growth more fairly. But to deliver that growth demands real change in the way the economy is run,” Corbyn said.

Take market liquidity, for example. Despite near-record notional volumes on TRACE, and policymakers’ protestations that nothing has really changed, market participants continue to lament that bid-offer is misleading, and depth is not what it used to be. Worse, many managers have struggled to make money on the basis of traditional single-name fundamentals, and poor performance is contributing to a steady leakage of flows away from traditional benchmarked funds towards totalreturn funds, indices and ETFs. The shift is not unique to credit: in European equities, futures-to-cash ratios – one convenient measure of index trading versus single-name trading – have reached all-time highs, for example (Figure 1).

Traditional thinking would not read too much into this. A decline in active single-name trading by some market participants should lead to greater dislocations, and hence greater opportunities for others. As index, or asset class, or factor investing becomes more popular, so it should become harder to make money there, and money should return to single-name trading. The system should stabilize. We are becoming more and more convinced this is wrong. In ways that were underappreciated at the time, the pre-crisis era of unlimited leverage led to a veritable bonanza for sellside and buyside alike, in which trading begat more trading, and liquidity begat liquidity. Cyclicals vs non-cyclicals. Value vs momentum. On-the-runs vs off-the-runs. Cash vs CDS. Single names vs indices. The constant arbitraging of relative value relationships led to regular patterns of mean reversion, which in turn encouraged more investors to trade.

In the post-crisis era, this process is running in reverse. Yet what started as a simple desire by regulators to curtail excesses of leverage risks is having much more farreaching repercussions. The curtailment of the hedge fund bid means that many relationships which previously mean reverted are now failing to do so, or at a minimum are doing so much more erratically. Cyclicals vs non-cyclicals. Value vs momentum. On-the-runs vs off-the-runs. Cash vs CDS. Single names vs indices. In principle, these aberrations do constitute trading opportunities – but only for investors with sufficiently strong stomachs and long time horizons, which these days nobody has. Central bank distortions have exacerbated these movements, making investor interest more one-sided and leading one market after another to exhibit more bubble-like tendencies, rising exponentially and then falling back abruptly.

Greek Prime Minister Alexis Tsipras braces for yet another vote on additional austerity measures, as European creditors remain at loggerheads with the IMF about how much debt relief the country will get for its pain. Lawmakers in Athens are scheduled to vote Sunday evening on an omnibus bill that includes measures ranging from the taxation of diamond dust and coffee to the transfer of thousands of real estate assets from the state to a new privatization fund. The debate will test the resilience of Tsipras’s three-seat parliamentary majority, as euro-area states resist calls from the IMF to set less ambitious fiscal targets and hand Greece more generous debt relief.

Approval of the measures is one of the prior actions Greece has to fulfill to unlock the next tranche of emergency loans from the European Stability Mechanism, the currency bloc’s crisis-fighting fund. The Eurogroup of 19 finance ministers will convene Tuesday to assess the country’s compliance with its latest bailout agreement struck in the summer of 2015. A positive assessment is also a condition for the Eurogroup to ease the servicing terms for over €200 billion of bailout loans handed to the country since 2010.

[..] The Washington-based IMF proposed that interest and principal payments on Greece’s European bailout loans be deferred until 2040, and that maturities on those loans will be extended to 2080, according to a document obtained by Bloomberg News. Even though European counter-proposals acknowledge that current Greek debt dynamics are unsustainable, they fall short of what the IMF wants, according to people familiar with the discussions that took place between government officials over the past week. Instead, the euro area expects Greece to maintain a budget surplus level which the IMF has said is a “far-fetched fantasy.”

Another Sunday, another vote in the Greek parliament, another self-imposed punishment beating as the parliament in Athens votes through fresh austerity measures. There will be higher VAT and an increase in taxes on all the pleasures of life: coffee, booze, fags, gambling, even pay TV. And just in case Greece might need to tighten its belt by another couple of notches to meet stringent budget targets, there will be additional measures that will kick in if there is any fiscal slippage over the next couple of years. George Harrison started his song Taxman with the words: “Let me tell you how it will be/There’s one for you, nineteen for me.” The Greeks know exactly what he meant. Greece’s predicament is simple. It has debt repayments to make this summer and it doesn’t have the money to pay the bills.

David Simonds/Observer

The EU can solve this acute cashflow problem by unlocking the funds pledged to Greece under the terms of last summer’s bailout agreement, but it will only do so if Athens demonstrates that it is serious about sorting out its budget. Austerity today will lead to generosity from EU finance ministers when they meet on Tuesday. That, at least, is the hope of Alexis Tsipras, Greece’s prime minister, who is looking for a package in which he gets debt relief in return for austerity. Here’s where things get interesting. The difference between this Sunday and all the other tension-packed Sundays that have studded the Greek crisis over the past six and a half years is that, this time, the battle is not between Greece and the “troika” of the European commission, the ECB and the IMF. Instead, there is a face-off between Europe and the IMF.

The Europeans badly want the fund to be part of Greece’s bailout and to contribute money to it. But Christine Lagarde, the IMF’s managing director, says her support is conditional on two things: a credible deficit reduction plan and a decent slug of debt relief. Hardline EU governments, led by Germany, have resisted this idea, fearing the Greeks will interpret any writedown of its debts as a sign of weakness that Athens will exploit to avoid meeting its budgetary commitments.

“Back to 1913. Isn’t it one of the most curious facts that all these historical figures [Tito, Hitler, Stalin, Trotsky, Freud and Franz Ferdinand] lived at the same time at the same place, maybe only a few hundred metres apart? Did any of them ever meet? Were they drinking coffee at the same place? Would the world history look different if Hitler had been psychoanalysed by Freud?”

Imagine the following group of curious characters living in the same city: a worker from Croatia, one unsuccessful painter, two Russians, a guy who analyses dreams and a young Austrian soldier and trophy hunter. Tito, Hitler, Stalin, Trotsky, Freud and Franz Ferdinand might make for unusual neighbours but, as Charles Emmerson describes in his recent book, 1913: In Search of the World Before the Great War, they spent plenty of time in the same two square miles of the capital of the Austro-Hungarian empire, Vienna, in 1913. Only one year later, Franz Ferdinand would become the Archduke of the empire, and his assassination in Sarajevo would lead to the first world war. In 1917, the two Russians became the leading figures of the October revolution and, about the same time, Tito – who would soon become leader of Yugoslavia – became active in the communist movement too.

Sixteen years later, on 30 January 1933, the unsuccessful painter became German Reichskanzler – the second world war was just around the corner. And Freud? After Nazi Germany annexed Austria in 1938, the Gestapo came after him and he became a refugee in London. In short, 1913 was one in which the course of history could have altered significantly. I am in no doubt that now might be another such period. At its collapse, the Austro-Hungarian empire consisted of 15 nations and more than 50 million inhabitants. The EU consists of 28 member states – with some now threatening to exit – and a population of 500 million.

Today’s Austria is facing one of its biggest political crises with the resignation of its chancellor, Werner Faymann, a second round of presidential elections looming on 22 May – which will in all likelihood result in a turn to the right – and, at the same time, nationalist calls for a referendum on Tyrol unification. We don’t know if some future Stalin or Hitler is living in Vienna, but the whole of Europe seems to be on the verge of an abyss. Recent news about a Syrian refugee who was shot by guards on the border between Slovakia and Hungary, and Turkish forces using live bullets to drive away Syrian refugees fleeing violence in their home towns point in that direction. If countries such as Denmark and Switzerland start to seize refugees’ assets, what is left of the European project nominally based on solidarity and brotherhood (“Alle Menschen werden Brüder …”, as the official anthem of the EU claims)?

The refugee crisis wasn’t – and can’t be – solved by investing €6bn in Turkey and “outsourcing” the “redundant humans” to the periphery of Europe again. Moreover, the case of German comedian Jan Boehmermann, who was charged for allegedly insulting the Turkish president, Recep Erdogan, shows that the EU’s only foreign policy is something we might call “export-import”. First we export wars (to Libya or Syria), then we import refugees. Then we export the refugees again (to Turkey), and then we import authoritarian values from Turkey, which is now killing one of the foundations of the European project – free speech. And humour.

Some European governments have already begun taking action against one {Roundup’s] co-formulants, a chemical known as polyethoxylated tallowamine, or POEA, which is used in Monsanto’s Roundup Classic and Roundup Original formulations, among other weed killers, to aid in penetrating the waxy surface of plants. Germany removed all herbicides containing POEA from the market in 2014, after a forestry worker who had been exposed to it developed toxic inflammation of the lungs. In early April, the French national health and safety agency known as ANSES took the first step toward banning products that combine glyphosate and POEA. A draft of the European Commission’s reregistration report on glyphosate proposed banning POEA.

[..] manufacturers of weed killers are required to disclose only the chemical structures of their “active” ingredients — and can hide the identity of the rest as confidential business information — for many years no one knew exactly what other chemicals were in these products, let alone how they affected health. In 2012, Robin Mesnage decided to change that. A cellular and molecular toxicologist in London, Mesnage bought nine herbicides containing glyphosate, including five different formulations of Roundup, and reverse engineered some of the other components. After studying the chemicals’ patterns using mass spectrometry, Mesnage and his colleagues came up with a list of possible molecular structures and then compared them with available chemical samples.

“It took around one year and three people (a specialist in pesticide toxicology, a specialist of chemical mixtures, and a specialist in mass spectrometry) to unravel the secrets of Monsanto’s Roundup formulations,” Mesnage explained in an email. The hard work paid off. In 2013, his team was able not only to deduce the chemical structure of additives in six of the nine formulations but also to show that each of these supposedly inert ingredients was more toxic than glyphosate alone. That breakthrough helped scientists know exactly which chemicals to study, though obtaining samples remains challenging. “We still can’t get them to make experiments,” said Nicolas Defarge, a molecular biologist based in Paris. Manufacturers of co-formulants are unwilling to “sell you anything if you are not a pesticide manufacturer, and even less if you are a scientist willing to assess their toxicity.”

So when Defarge, Mesnage, and five other scientists embarked on their most recent research, they had to be creative. They were able to buy six weed killers, including Roundup WeatherMax and Roundup Classic, at the store. But, finding pure samples of the co-formulants in them was trickier. The scientists got one from a farmer who mixes his own herbicide. For another, they went to a company that uses the chemical to make soap. “They were of course not aware that I was going to assess it for toxic and endocrine-disrupting effects,” said Defarge. András Székács, one of Defarge’s co-authors who is based in Hungary, provided samples of the other three co-formulants studied, but didn’t respond to inquiries about how he obtained them.

In February, the team published its findings, which showed that each of the five co-formulants affected the function of both the mitochondria in human placental cells and aromatase, an enzyme that affects sexual development. Not only did these chemicals, which aren’t named on herbicide labels, affect biological functions, they did so at levels far below the concentrations used in commercially available products. In fact, POEA — officially an “inert” ingredient — was between 1,200 and 2,000 times more toxic to cells than glyphosate, officially the “active” ingredient.

The new era of the internet, the smartphone and the PC has had radical effects on who we are and how we relate to each other. The old boundaries of space and time seem collapsed thanks to the digital technology that structures everyday life. We can communicate instantly across both vast and minute distances, Skyping a relative on another continent or texting a classmate sitting at the next table. Videos and photos course through the web at the touch of a screen, and social media broadcast the minutiae of both public and private lives. On the train, the bus, in the cafe and the car, this is what people are doing, tapping and talking, browsing and clicking, scrolling and swiping.

Philosophers, social theorists, psychologists and anthropologists have all spoken of the new reality that we inhabit as a result of these changes. Relationships are arguably more shallow or more profound, more durable or more transitory, more fragile or more grounded. But what if we were to see this chapter in human history through a slightly different lens? What if, rather than focusing on the new promises or discontents of contemporary civilisation, we see today’s changes as first and foremost changes in what human beings do with their hands? The digital age may have transformed many aspects of our experience, but its most obvious yet neglected feature is that it allows people to keep their hands busy in a variety of unprecedented ways.

The owner of the Shakespeare and Company bookshop describes the way young people now try to turn pages by scrolling them, and Apple have even applied for patents for certain hand gestures. Patent application 7844915, filed in 2007, covered document scrolling and the pinch-to-zoom gesture, while the 2008 application 7479949 covered a range of multitouch gestures. Both were ruled invalid, not because gestures can’t be patented, but because they were already covered by prior patents. At the same time, doctors observe massive increases in computer- and phone-related hand problems, as the fingers and wrist are being used for new movements that nothing has prepared them for.

Changes to both the hard and soft tissues of the hand itself are predicted as a consequence of this new regime. We will, ultimately, have different hands, in the same way that the structure of the mouth has been altered, it is argued, by the introduction of cutlery, which changed the topography of the bite. The edge-to-edge bite that we used to have up to around 250 years ago became the overbite, with the top incisors hanging over the lower set, thanks to new ways of cutting up food that the table knife made possible. That the body is secondary to the technology here is echoed in the branding of today’s products: it is the pad and the phone that are capitalised in the iPad and iPhone rather than the “I” of the user.

Countries are just waking up to the most serious global food crisis of the last 25 years. Caused by the strongest El Niño weather event since 1982, droughts and heatwaves have ravaged much of India, Latin America and parts of south-east Asia. But the worst effects of this natural phenomenon, which begins with waters warming in the equatorial Pacific, are to be found in southern Africa. A second consecutive year without rain now threatens catastrophe for some of the poorest people in the world. The scale of the crisis unfolding in 10 or more southern African countries has shocked the United Nations. Lulled into thinking that Ethiopia in 1985 was the last of the large-scale famines affecting many millions, donor countries have been slow to pledge funds or support. More than $650m and 7.9m tonnes of food are needed immediately, says the UN. By Christmas, the situation will have become severe.

The scale of the crisis unfolding in 10 or more southern African countries has shocked the United Nations. Lulled into thinking that Ethiopia in 1985 was the last of the large-scale famines affecting many millions, donor countries have been slow to pledge funds or support. More than $650m and 7.9m tonnes of food are needed immediately, says the UN. By Christmas, the situation will have become severe. Malawi, Mozambique, Lesotho, Zimbabwe, Namibia, Madagascar, Angola and Swaziland have already declared national emergencies or disasters, as have seven of South Africa’s nine provinces. Other countries, including Botswana and the Democratic Republic of the Congo, have also been badly hit. President Robert Mugabe has appealed for $1.5bn to buy food for Zimbabwe and Malawi is expected to declare that more than 8 million people, or half the country, will need food aid by November.

More than 31 million people in the region are said by the UN to need food now, but this number is expected to rise to at least 49 million across almost all of southern Africa by Christmas. With 12 million more hungry people in Ethiopia, 7 million in Yemen, 6 million in Southern Sudan and more in the Central African Republic and Chad, a continent-scale food crisis is unfolding. “Food security across southern Africa will start deteriorating by July, reaching its peak between December 2016 and April 2017,” says the UN’s office for humanitarian affairs. The regional cereal deficit already stands at 7.9m tonnes and continues to put upward pressure on market prices, which are already showing unprecedented increases, diminishing purchasing power and thereby reducing food access. As food insecurity tightens and water scarcity increases due to the drought, there are early signs of acute malnutrition in Madagascar, Malawi, Mozambique and Zimbabwe.

Time does indeed fly; I’ve already been back in Athens for a week, but I still haven’t told you about it -a nasty flu now in its 4th day is a partial excuse-, and also haven’t even written the story of my last trip in Nov-Dec. Don’t think it’s Zika, though that’s a weird story; from what I gather someone was testing a GMO fly back in the Caribbean that caused this mutation and now someone wants to fight it with another GMO fly?! Ain’t we smart.

Anyway, the stunning generosity of the Automatic Earth readers left me no choice but to visit the city again so soon, really. Which is I think a really good thing.

In the article, I made an appeal for help for the work of my new best friend Kostas (Konstantinos Polychronopoulos), who has devoted his entire life to helping the poor and homeless of Athens (an ever faster ever growing group of people), starting with providing at least a decent meal. I first talked about Kostas’ work in July just after I first met him in AE for Athens Fund 2nd Donation: The Man Who Cooks In The Street.

I was saying before how ‘The Other Human’ [O Allas Anthropos] social kitchen had grown at least 5-fold. That is a bit of an understatement. There are now 5 different ‘kitchen teams’ running (vs 1-2 before), and they hand out over 3000 meals a day today instead of the 300 earlier in the year. There simply is that much need. The Greeks themselves are getting poorer, fast, and refugees have become a major ‘target’ group as well. Kostas began running operations on Lesbos over the summer, and has a team in place there now as well as on Salimani island and 3 different locations in the Athens area. And there’s no doubt he would like to do more.

Before, costs would be covered by food donations and sympathizers giving €5 or €10 a month from what little they have. Between pensions cuts, pay cuts and capital controls, the number of Greeks who have next to nothing rises fast. It’s no exception for former supporters to now come to rely on Kostas for their own food. Nor is it exceptional for grandmothers to still insist on giving $5 from the €400 that’s all that’s left of their pension. Greeks do solidarity well.

But the numbers are getting out of hand, so many people need help, and it promises to get much worse in 2016, looking at the new austerity measures the troika is forcing upon the country, and the expected numbers of refugees arriving. The donations that used to run ‘The Other Human’ are simply not enough to cover operations any longer, let alone expand them where most needed.

And while the €1000 I donated earlier this year went a -relatively- long way, the second €1000, though at least as much appreciated, won’t go nearly as far. When I was told ‘The Other Human’ have been forced to cancel some cooking events now -for the cold and hungry homeless, for crying out loud, who are increasingly people that used to have jobs and homes and all until recently-, simply because they can’t afford to feed the poor, that actually hurt, and stung. That felt personal.

Turns out, since then, more has been added (‘the need is so great’). As per a quite hilarious email from Kostas 10 days ago, when I hadn’t arrived in Greece yet:

My friend Raul; By Wednesday I am here and the kitchen of lesbian, hope to see a third or fourth. Tells other people that the social kitchen has grown, we speak has seven and prepared in other two cities in Greece.

Yeah, that made me laugh. Still don’t know if he intended that ‘lesbian kitchen’ thing. He did seem to find it awfully funny when I remarked on it, though, in person the other day. On a more serious note, what he’s saying is that in the past month, he went from 5 to 7 social kitchens, and is adding 2 more. Or trying to.

‘That Wednesday’ was 5 days ago. We had a meeting then with a few people to coordinate how we’re going to make the entire situation as clear and transparent as we can to you, Automatic Earth readers, who’ve already donated over another $8000 (!) -it’s truly stunning- since December 22 (on top of the first AE for Athens fund I started in spring 2015, for which $12,000 came in and which has $7000 left in it).

Allow me to repeat: I never had the slightest idea, I thought I’d get a few hundred bucks when I first brought this up, in spring 2015, even before I met Kostas, and that’d be it. It’s more humbling than I can put into words to have you trust me with so much. There’s not an inch of me that isn’t constantly aware of that.

Those kind of amounts take it from being something nice, to being a serious responsibility, in my view. And Kostas agrees completely. So this Wednesday we’re going to have a big gathering with lots of the people who work for ‘The Social Kitchen’, in the various locations the organization operates in, have a big get-together, take lots of pictures, hopefully have a party -which all the volunteers truly deserve-, and exchange more detailed information.

Moreover, we’re going to -try to- spell out exactly -up to a point- what your money is being spent on. And, of course, talk about what we can do to increase the funding, and -especially- how to make it more structural -once every week, month or year-. I realize full well that there is a limit to what the Automatic Earth and its readers can do, but I guess we’re simply going to keep pushing with what we have, and see where it ends.

I don’t know enough about crowdfunding and crowdsourcing and the like to get that up and going with enough confidence in either the outcome or the process itself -but I’m very open to suggestions-, and I apparently don’t know enough about how to get the rest of the finance blogosphere going either. What a shame, there’s so much money on the one side, and so much need on the other. But that doesn’t mean I intend to stop pushing.

More on Kostas and O Allas Anthropos later this week. There are a few other things I would like to share with you. First, something I noticed last month in supermarkets here -the ones I see in the center are not all that big-, that flashed a big red sign and made me think of Eastern European stores I’ve seen.

Troika-imposed austerity and taxes have had a double whammy impact. People have much less to spend on basic needs, and what is still available has become expensive, even in western European terms. So what you get is a lot of empty shelves:

I’ve seen stores where I swear I saw half the employees being busy making those shelves look less empty by spreading what is still for sale, across the empty spaces. At least these people still have a job, though I must wonder what they pay.

Those are pictures I took in December, of something I don’t remember seeing in June/July on my first trip here. I was in a large Carrefour -major French chain- supermarket where I didn’t take pictures, and it was even more evident there. Empty shelves. Near to the center of a large city in the western world.

Then, there’s another organization that I need to tell you about, since I donated $1000 of your money to it, from the AE fund for Athens that I started with last spring.

I was introduced by a friend to Myrto Lemos, a woman who started doing field work in New York City in the late 1970s (she must be in her 70s now). Upon her return to Athens in the 1980s, she began working with -‘socially excluded’- street children in central Athens’ poorest areas, specifically those from Greek muslim and Roma backgrounds. In 1997, she established the Support Center for Children and Families for them. It is run -as so many things are in Greece these days- entirely by volunteers.

Here’s Myrto with Kostas, I didn’t know they knew each other, and neither did the people who introduced me to her, but turned out they did:

The children Myrto has devoted her whole life to -I have so much admiration for people with that dedication- would typically sell flowers, balloons and trinkets on the street all day every day (for generations, basically), there was never a culture of going to school or anything like that. Myrto decided it was time to change that.

And she did. The best example, I found, was a young girl who now works as a social worker at the Support Center, but who had never even been to school before the age of 12, who couldn’t read or write, nothing. And now there she is on the left answering the phone, a fully educated social worker (imagine how proud Myrto is):

The Center provides food (a big thing) and education for the children, makes sure they go to school, and gives -badly needed- social and legal help to their families (where no-one can read or write). I’ve got to say, to me, this was an entirely unexpected corner of society, and the needs existing within it.

But Athens, and Greece in general, have of course been on a crossroads of cultures and societies for thousands of years, so it should be no surprise to find parts of them anchored -left behind?!- inside the city, albeit largely forgotten.

Greece is known as one of the best educated countries on the planet – though that can’t possible have improved over the past 5-10 austerity years-, and then you still find entire cultures that never went to school. Ironically, it’s the austerity policies that force more of these kids back out into the streets peddling their trinkets and not attending school, just so their families can eat. A major issue and worry for Myrto, who wants them at school.

Here’s the pretty much nondescript building the Center is housed in at the corner of Aristonos 6-8 & Pierias, Kolonos:

Plus, the lovely grand map of the world that covers an entire wall in one of the homework rooms, with divers and dolphins and kangaroos and elephants and turtles and whales and hidden treasures, what a great way to learn about the world you live in, when no-one ever told you:

And the inevitable lovely adorable far too cute and far too smart little girl doing her homework, who, lest we forget, if not for Myrto would probably have been peddling balloons on the streets -or worse- without ever having learned to read or write, for the rest of her life. Now, she has a shot at being a person, a woman in her own right.

It’s an honor and a privilege to be able to meet these people, and be able to do something very useful for them, thanks to you, Automatic Earth readers.

I see so much passing by each and every day in the financial press about allegedly successful people, and what makes them successful, and it’s always about the amount of money they make or have made.

But for me, success is defined by what a person does for others, it’s about helping people, not helping yourself. And I, through a twist of fate I had never planned or even imagined, get to meet these people here in a pretty much derelict society, where not much runs any longer as it once did, and where worse is on the horizon.

And that’s where you get to see who people really are, where you find people who say: ‘it’s not about me’. In the world of finance, it’s always only about ‘me’, and about money, and the seemingly unbreakable umbilical cord between the two.

Do you think the markets are going to rise? Here’s how to make money. Do you think they will fall? Here’s how to make money off of that. It’s all only about me and my money, but it’s a life that’s barely even breathing, and barely moving at that, a bunch of automatons thinking they prove their smarts if they pick the ‘right’ swing of a one-dimensional pendulum.

If that’s all people are about, and what you and I are about, why bother? Just so maybe one day we can sit our asses down at a pool in the Caribbean and say ‘we got it made’, while millions of others elsewhere in the world grovel in the dirt and wind up burying the children they love, in that same dirt?

It’s the quintessential difference between what you have and what you are. And about who has sufficient faith in what they are, and doesn’t feel the need to hide behind what they have. Who doesn’t think that if the whip comes down and the whole debt circus tent gets blown away in a wicked storm, they’ll still be fine if only they bought enough gold or bitcoin or whatever in advance.

But that’s a hard nut to crack in today’s world. So we’ll instead let it seep in drop by drop. Same difference. Though that’ll still be denied too.

If in the meantime, sorry but my cold won’t let me do much of anything right now, you want to contribute to the Social Kitchen project, the way to do it is still through the Automatic Earth‘s Paypal widget, top left hand corner of every page. Amounts ending in $0.99 or $0.37 go towards the Social Kitchen, others towards supporting the Automatic Earth (which is also highly needed, and without which we couldn’t do the whole thing, regardless.)

Now if you’ll excuse me, I’m going to find myself a hole to reside in until my cold is over. And I’ll be back with more on this later in the week.

At least 40 stock markets around the world with a total value of $27 trillion are in bear territory, as investors witness the worst start to a year on record. The U.K. was the latest market to fall 20% from its peak, while India is 1% away from crossing the threshold that traders describe as the onset of bear market. Nineteen countries with $30 trillion have declined between 10% and 20%, thereby entering a so-called correction, according to data compiled by Bloomberg from the 63 biggest markets.

U.S. index futures declined after a rally in Asian stocks reversed, pushing a gauge of global equities back to the brink of a bear market. Oil fell and the yen strengthened. Benchmark share measures in Tokyo, Shanghai and Manila slumped at least 2.8%, while Standard & Poor’s 500 Index contracts erased early gains to trade 0.9% lower. European index futures slid after the region’s stocks plunged the most since August on Wednesday. China’s equitiesfell despite a drop in money-market rates as the People’s Bank of China injected the most cash via open-market operations since 2013. The yen approached a one-year high reached Wednesday. Copper pared an advance.

Volatility has coursed through financial markets in 2016, amid turmoil in Chinesemarkets and the almost uninterrupted selloff in crude oil. The S&P 500’s plunge Wednesday triggered a technical signal indicating U.S. stocks were oversold, spurring a paring of losses that prevented the MSCI All-Country World Index from entering a bear market. The ECB meets Thursday, the first major monetary authority to review interest rates and policy since turmoil gripped markets at the start of the year. “The ground right now is so unstable, and there’s so much anxiety,” said Ayako Sera at Sumitomo Mitsui Trust. “We saw a rally, but I wouldn’t say that we’re in a full rebound yet. People are just bottom-fishing.”

Global investors and companies pulled $735 billion out of emerging markets in 2015, the worst capital flight in at least 15 years, the Institute of International Finance said. The amount was almost seven times bigger than what was recorded in 2014, the Washington-based think tank said in a report on Wednesday. China was the biggest loser, with $676 billion leaving its markets. The IIF predicted investors may withdraw $348 billion from developing countries this year. Emerging-market stocks are trading at the lowest levels since May 2009 and a gauge of 20 currencies has slumped to a record. A meltdown in commodity prices and concern over the slowdown in China’s growth to the weakest since 1990 are spurring investors to dump assets from China to Russia and Brazil.

The 31 biggest developing markets have lost a combined $2 trillion in equity values since the start of 2016. “We’ve seen massive outflows from emerging markets to the benefit of the euro zone and Japan,” said Ibra Wane at Amundi Asset Management. “Institutional investors have been more attracted by these regions.” Wane said the shift in flows is a result of monetary-policy changes, as the Federal Reserve raised interest rates in December for the first time in almost a decade, which is also partly to blame for the volatility in emerging-market currencies. “I’d rather look first at stabilization of currencies,” Wane said. “If this were to come true, then probably also flows would come on top of it.”

All 24 emerging-market currencies tracked by Bloomberg have depreciated against the dollar in the past year, with the Argentine peso, the Brazilian real and the South African rand getting hit the worst. “Countries with large current-account deficits, high levels of foreign-exchange corporate indebtedness and questionable macro policy frameworks would come under particular pressure in the event of further emerging-market retrenchment,” the IIF report said. “At-risk countries include Brazil, South Africa and Turkey.” The Chinese yuan’s 5.5% drop in the past 12 months was one of the drivers of outflows from the world’s second biggest economy, according to the IIF report. “The 2015 outflows largely reflected efforts by Chinese corporates to reduce dollar exposure after years of heavy dollar borrowing, as expectations of persistent RMB appreciation were replaced by rising concerns about a weakening currency,” the report said.

The selloff in oil prices accelerated Wednesday, intensifying a slide in global financial markets as investors worried that oil’s relentless downdraft signaled global economic gloom. The front-month U.S. oil contract settled down 6.7%, posting the biggest one-day loss since September. Oil prices have dropped more than 25% this year. Much of the 19-month oil-market selloff has been driven by concerns about ample supplies. What’s increasingly weighing on investors is the fear that demand growth is wilting, particularly in China, which could reflect deeper economic woes. “Global economic forces appear to be driving down demand for commodities, ” Citigroup said in a note. “There is no doubt that declining expectations of global growth are exacerbating the results of oversupply across commodity markets.”

Light, sweet crude for February delivery settled down $1.91 to $26.55 a barrel on the New York Mercantile Exchange. The February contract expires at settlement Wednesday. Brent, the global benchmark, fell 82 cents, or 2.9%, to $27.94 a barrel on ICE Futures Europe, also on track for the lowest settlement since 2003. Oil investors fear that demand in China, which consumes about 12% of world’s crude, may falter as the country shifts to a less energy-intensive economic model. On Tuesday, the Chinese authorities announced the country’s gross domestic product rose 6.9% in 2015, its slowest pace in 25 years. ESAI Energy said Wednesday that the pace of demand growth in China from 2015 to 2030 will be 60% slower than the pace of demand growth from 2000 to 2015.

Markets are pricing in a higher default risk for the energy sector than they did at the peak of the Great Recession, according to data from Schwab and Barclays. As continued concerns about oil’s global supply glut pushed crude futures below $27 a barrel, sparking a global stock selloff, energy spreads surpassed their 2009 peak. A spread is a yield differential between the index and comparable risk-free Treasurys. Widening spreads mean investors are pricing in more risk for the energy sector and require a higher yield as compensation for their risk. As the following chart shows, the spread on the energy sector of the Barclays U.S. Corporate High-Yield Bond Index, a widely followed gauge of market-priced risk, reached 1,530 basis points as of Tuesday’s close, compared with 1,420 basis points reached during the height of the financial crisis seven years ago. One basis point is equivalent to 0.01% or one hundredth of a percentage point.

Credit-market spreads are often viewed as a leading indicator for equity markets. Spreads in the energy sector have been widening since the summer of 2014, and spiked over the past few months amid the recent rout in oil prices. That dynamic has certainly played out lately. Stocks followed oil’s decline, weighed by sinking shares of energy companies. The energy sector was the worst performer on the S&P 500 on Wednesday, and is down nearly 15% since the beginning of the year. Meanwhile, energy companies led decliners among the Dow industrials. Widening credit spreads imply that “the market is clearly expecting the default rate to pick up, as the balance sheets of some of the riskier energy companies won’t be able to sustain this drop in oil prices” said Collin Martin, director of fixed-income strategy for the Schwab Center for Financial Research.

Oil is in free fall and Terry Clark couldn’t be happier. In mid-2014, when the crude price topped $100 a barrel, Clark made an offer to buy properties from Dune Energy, a small driller with money trouble. Dune turned him down. A year later, as oil plunged to $60 a barrel, Dune filed for bankruptcy and Clark’s White Marlin Oil & Gas picked up the assets at auction at a deep discount. “What we offered versus what we got it for, it’s a great price,” Clark said. “We’re going to continue to play these bankruptcies. We’re participating in two more right now.” Winners and losers are emerging from the energy bust. What’s a meal for Clark is indigestion for banks that financed the boom using oil and gas properties as collateral. The four biggest U.S. banks – Bank of America, Citigroup, JPMorgan and Wells Fargo – have set aside at least $2.5 billion combined to cover souring energy loans and have said they’ll add to that if prices stay low.

There’s plenty to keep Clark bargain-hunting. Last year, 42 U.S. energy companies went bankrupt, owing more than $17 billion, according to a report from law firm Haynes & Boone. Dune went belly up owing $144.2 million. Its assets sold for $20 million. In May, American Eagle filed for bankruptcy with debts of $215 million. Its properties sold for $45 million in October. BPZ Resources owed $275.2 million. Its assets fetched about $9 million. Endeavour went into bankruptcy owing $1.63 billion. The company sold some assets for $9.65 million and handed over the rest to lenders. ERG Resources opened an auction with a minimum bid of $250 million. Response? No takers. “A lot of people got into this business and didn’t really understand the ups and downs of price cycles,” said Becky Roof, a managing director for turnaround and restructuring with the consulting firm AlixPartners. “They’re getting a very bad dose of reality right now.”

The People’s Bank of China injected the most cash in almost three years in its open-market operations, helping ease a cash squeeze as the coming Chinese New Year holiday spurs demand for funds at a time when capital outflows are mounting. The central bank said it conducted 110 billion yuan ($16.7 billion) of seven-day reverse-repurchase agreements and 290 billion yuan of 28-day contracts. That compares with 160 billion yuan of contracts that matured and resulted in a net cash injection of 315 billion yuan for this week’s two auctions. Other lending tools were used to add about 700 billion yuan this week for terms ranging from three days to a year.

China is trying to hold borrowing costs down to support its economy without spurring an exodus of funds that drove the yuan to a five-year low this month. Gross domestic product rose last year at the slowest pace in a quarter century and intervention to prop up the exchange rate led to a record $513 billion plunge in the nation’s foreign-exchange reserves. The Chinese New Year holiday – a period for feasting and exchanging gifts – will shut China’s financial markets throughout the week starting Feb. 8. “The market is a bit nervous and liquidity is also needed to cover the Chinese New Year,” said Frances Cheung, Hong Kong-based head of rates strategy for Asia ex-Japan at Societe Generale.

“The fact that they are going for longer tenors on reverse repos and its MLF does add to market expectations for a delay in a reserve-ratio cut, which in itself could be linked to the currency market performance.” The central bank injected 410 billion yuan into the banking system via three- and 12-month loans under its Medium-Term Lending Facility this week, while Short-term Liquidity Operations were used to add 55 billion yuan of three-day loans on Monday and another 150 billion yuan of six-day funds on Wednesday. The PBOC also auctioned 80 billion yuan of treasury deposits on behalf of the Ministry of Finance this week.

If Bank of America is right, Chinese stocks in Hong Kong are poised for a fresh wave of selling. That’s because the benchmark Hang Seng China Enterprises Index is approaching a level that forces investment banks to pare back their bullish futures positions, according to William Chan, the head of Asia Pacific equity derivatives research at BofAML in Hong Kong. The trades, tied to banks’ issuance of structured products, are likely to start unwinding when the index falls through 8,000, a level it briefly breached on Wednesday. The gauge dropped 1% to 7,932.24 at 1:05 p.m. local time on Thursday. Banks have purchased futures on the gauge of so-called H shares to hedge exposure to structured products that they’ve sold to clients, according to Chan.

Many of those products have a “knock-in” feature at the 8,000 level that will spur banks to cut futures positions to maintain the effectiveness of their hedges, he said. Additional pressure points may also come at lower levels, Chan said. “As the market goes lower from here, the downward move may accelerate,” he said. “There will be a large amount of hedging in futures which dealers need to unwind.” While the opaque nature of structured products makes it difficult to gauge how much money is riding on any particular level of the Hang Seng China index, Chan came to his conclusion by analyzing regulatory data from South Korea, one of the few countries that publicizes such figures.

The nation is among the region’s biggest markets for structured products and there’s currently a notional value of about $34 billion from Korea linked to the Hang Seng China measure, according to Chan. When banks sell the structured products to investors, they take on an exposure that’s similar to purchasing a put option on the index, Chan said. To hedge against the possibility of a rally, the banks buy Hang Seng China index futures. If the stock gauge falls below knock-in levels for the structured products – the price at which investors begin to lose their principal – the sensitivity of the bank’s position to index swings gets smaller, and banks respond by selling futures to reduce their hedge.

The eyes of the financial and economic worlds are now fixed on China, with focus predominantly on Chinese stock markets and the country’s GDP figures. A fascinating perspective was provided last week in the leafy borough of Kingston upon Thames. The university there has recruited the Australian Steve Keen as head of its economics department, and it was the occasion of his inaugural lecture. Keen was one of the few economists to highlight the importance of private sector debt before the financial crisis began in 2008. The title of the lecture itself was exciting: “Is capitalism doomed to have crises?” Judging by the beards and dress style of the audience, many may have expected a Corbynesque rant. Instead, we heard an elegant exposition based on a set of non-linear differential equations.

Private sector debt is the sum of the debts held by individuals and companies, excluding financial sector firms like banks. Keen pointed out that, in the decade prior to the massive crash of 1929, the size of private debt relative to the output of the economy as a whole (GDP) rose by well over 50%. The increase from the late 1990s onwards meant that debt once again reached dizzy heights. In ten years, it rose from being around 1.2 times as big as the economy to being 1.7 times larger. This may seem small. But American GDP in 2007 was over $14 trillion. If debt had risen in line with the economy, it would have been about $17 trillion. Instead, it was $24 trillion, an extra $7 trillion of debt to worry about. Japan experienced a huge financial crash at the end of the 1980s.

The Nikkei share index lost no less than 80% of its peak value, and land values in Tokyo fell by 90%. During the 1980s, private sector debt rose from being some 1.4 times as big as the economy to 2.1 times the size. In China, in 2005, the value of private debt was around 1.2 times GDP. It is now around twice the size. Drawing parallels with the previous experiences of America and Japan, a major financial crisis is not only overdue but it is actually happening. And Keen suggests there is still some way to go. So is it all doom and gloom? Up to a point, Lord Copper. High levels of private sector debt relative to the size of the economy do indeed seem to precede crises. But there is no hard and fast rule on the subsequent fall in share prices.

Japanese shares fell 80% and have not yet recovered their late 1980s levels. In the 1930s, US equities fell 75%, and took until 1952 to bounce back. In the latest financial crisis, they fell by 50% but are even now above their 2007 high. Equally, output responds to these falls in completely different ways. In the 1930s, American GDP fell by 25%, compared to just 3% in the late 2000s. Japan has struggled, but never experienced a major recession. Still, Keen’s arguments leave much food for thought.

Deutsche Bank AG, Germany’s biggest lender, expects to post a €2.1 billion loss for the fourth quarter after setting aside more money for legal matters and taking a restructuring charge. The stock is at the lowest since 2009. About €1.2 billion were earmarked for litigation and €800 million for restructuring and severance costs, mainly in the private and business clients division, the Frankfurt-based firm said Wednesday in a statement. “Challenging market conditions” also hurt earnings at the investment bank during the quarter, cutting group revenue to about €6.6 billion, it said. The bank had reported €7.8 billion of net revenue a year earlier. Co-CEO John Cryan has been seeking ways to restore investor confidence and earnings growth battered by costs tied to past misconduct.

Under his overhaul, Deutsche Bank plans to shrink headcount by 26,000, or a quarter of the workforce, by 2018 while planning to suspend the dividend to help shore up capital buffers. “A real fresh start means even lower stated net profits for some time,” Daniele Brupbacher at UBS in Zurich who has a neutral rating on the shares, wrote in a note on Thursday. Conditions for the company will probably “remain challenging” in the first quarter, he wrote. The stock fell as much as 6% and was down 3.5% at 17.10 euros as of 9:16 a.m. in Frankfurt, the biggest decline in the 46-member Stoxx Europe 600 Banks Index. Deutsche Bank’s 24% decline this year means it’s the worst-valued global bank.

Film director Lori Silverbush has spoken out on hunger in the US and says it is still a massive problem three years after making a documentary on the subject. The US faces staggering statistics on food poverty – the highest under the current government administration since the 1970s when hunger was almost eradicated in the US. One in six Americans are hungry, while 30% of Americans are described as “food insecure” – meaning they can’t guarantee they can always put food on the table. Mrs Silverbush’s film “A Place At The Table”, which she co-directed alongside Kristi Jacobsen, reveals that 44 million Americans rely on food stamps, which are worth around $3 to $4 per day.

Insufficient funds mean that people can’t afford to buy fresh fruit or vegetables, which have gone up in price by 40% since the obesity crisis began, according to author Marion Nestle, and instead they rely on cheap, processed foods. As a result, obesity and poverty “are neighbours”, said End Hunger Network founder Jeff Bridges. Speaking at the Brooklyn Historical Society on Tuesday evening, Mrs Silverbush said her “blood boiled” when she realized that food poverty is a result of politics. The government has spent $0.75 trillion since 1995 on subsidies to wealthy agriculture companies that are responsible for processed foods, a policy that started during the Great Depression of the 1930s.

“We didn’t know there was hunger in every county or that there were millions of working families that were hungry,” she said. “Malnutrition and hunger cause a cascade of terrible, life-long consequences for kids.” The film also revealed that one in three children born in the year 2000 will be diagnosed with type 2 diabetes. Hunger is expensive. It costs the US government $167 billion a year, according to the film. One interviewee, Barbie Izquierdo, lives in Philadelphia with two children, and her food stamps were taken away once she secured full time employment, leaving her without enough money to feed her family. “Define starving,” she said. “Are you starving if you don’t eat for a day?“

Please, PEPPER SPRAY ALL THE ATTENDEES OF DAVOS in order to halt the rape of taxpayers and consumers across the globe. This annual conclave is responsible for more wealth destruction and the widening disparity in GINI coefficients than any public policy. I believe that the cost of attending Davos is priced at such an extravagant rate because it is a giant insider scam. Hobnob with politicians and policy makers in an effort to be part of the “smart money” crowd. It was the great moral philosopher and economist Adam Smith who so presciently noted: “People of the same trade seldom meet together, even for the merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” The conspiracy against the public has been the financial repression of the global middle class in an effort to bail out those who are attached themselves to the public treasury to maintain the “animal spirits” of crony capitalism.

The cost of an entrance pass to this private/public congress of mover and shakers should sound an alarm to all those who desire transparency in financial markets. In contemporizing the words of Adam Smith, Samuel Huntington was credited in the online research cite, Acton Commentary, as creating the phrase DAVOS MAN: “A soulless man, technocratic, nationless and cultureless, severed from reality. The modern economics that undergirded Davos capitalism is equally soulless, a managerial capitalism that reduces economics to mathematics and separates it from human action and human creativity.”

Friday’s release of the 2010 FOMC transcripts reveals that Chair Bernanke raised concerns “… about inappropriate access to information by outsiders other than the media, including consultants, market people and so on.” It was earlier revealed that Bernanke had held discussions with ECB President Trichet about the seriousness of the European sovereign debt crisis. The Reuters story post-transcript release–“Fed Helped ECB With Swaps after Trichet ‘Personal Appeal’”–quotes Chairman Bernanke: “Yesterday [ECB Chief] Jean-Claude Trichet called me and made what I would characterize as a personal appeal to re-open the swaps that we had before,” Bernanke told his colleagues at the UNSCHEDULED meeting.”

In a further analysis by Reuters, the article notes, “The transcripts, which are released after five years, show how closely Bernanke worked with Trichet, who shared ‘highly confidential’ information about the ECB’s part in a trillion-dollar ‘shock and awe’ rescue plan launched by EU leaders to combat an escalating financial crisis in Europe.” Ten months later Chairman Bernanke is openly warning FOMC members about leaks from its meetings. Curious about how much the DAVOS crowd made from the whispers emanating from the Fed Board Room? It costs more than $600,000 to be a strategic partner at Davos and be allowed into the most high-level meetings with the most important CEOs and policy makers. But if the inside scoop is info beyond the ears of mere mortals PRICE IS NO OBJECT BUT INSIDER PROFITS CERTAINLY ARE. More pepper spray to stop the rapes.

“My generation can’t afford houses. My generation can’t afford to have children. My generation are either leaving the country or jumping in rivers. That’s my generation, man,” Blindboy said on RTE’s Late Late Show on 8 January. “My generation is dealing with neoliberalism [sic] economic policies that are similar enough to the economic liberalism at the time of the Famine,” he said. “It’s a laisse-faire system, where our resources of the country are being sold for private interests and our generation, my generation is screwed.” When I saw that, it got me thinking: negative perceptions of the working class are so strong in Irish society that people who use food banks would rather call themselves “poor” than “working class”. This is the result of successful divide-and-conquer tactics.

Because the truth is that these days – the poor, the working poor, the working class, the middle-class – almost all of us are screwed. The wealth is trickling upwards to a very few. You can see it in a survey the Dublin think tank TASC released in December, which laid out the division of wealth in Ireland. The top 20% are the ones squeezing everybody’s middle: they have almost 73% of Ireland’s wealth. So if we look at a financial definition of working class, rather than a cultural one, the majority of us fit right in there together, even those notionally middle-class people who would recoil if you tried to tell them they were working class. Given this situation, I would expect to see howls of protest in the mainstream media, all the time. But I don’t see this kind of media outcry, and I wonder why.

Maybe it’s because the mainstream media usually take the side of the market, seeing issues from a market perspective. And I guess the market doesn’t care if our generation is screwed. It might actually be a good thing, from a market perspective, because it ensures there’s a steady supply of young people desperate for jobs, which keeps demand for wages and benefits to a minimum. And that would be rather attractive to multinationals looking for cheap workers. Meanwhile, journalists are just trying to survive too. Most of them are in precarious positions, and, unless they want a ticket to the hunger games, it’s human nature for them to keep their heads down and go with the status quo.

The state of the world’s fish stocks may be in worse shape than official reports indicate, according to new data – a possibility with worrying consequences for both international food security and marine ecosystems. A study published Tuesday in the journal Nature Communications suggests that the national data many countries have submitted to the UN’s Food and Agriculture Organization (FAO) has not always accurately reflected the amount of fish actually caught over the past six decades. And the paper indicates that global fishing practices may have been even less sustainable over the past few decades than scientists previously thought. The FAO’s official data report that global marine fisheries catches peaked in 1996 at 86 million metric tons and have since slightly declined.

But a collaborative effort from more than 50 institutions around the world has produced data that tell a different story altogether. The new data suggest that global catches actually peaked at 130 metric tons in 1996 and have declined sharply – on average, by about 1.2 million metric tons every year – ever since. The effort was led by researchers Daniel Pauly and Dirk Zeller of the University of British Columbia’s Sea Around Us project. The two were interested investigating the extent to which data submitted to the FAO was misrepresented or underreported. Scientists had previously noticed, for instance, that when nations recorded “no data” for a given region or fishing sector, that value would be translated into a zero in FAO records – not always an accurate reflection of the actual catches that were made.

Additionally, recreational fishing, discarded bycatch (that is, fish that are caught and then thrown away for various reasons) and illegal fishing have often gone unreported by various nations, said Pauly. “The result of this is that the catch is underestimated,” he said. So the researchers teamed up with partners all over the world to help them examine the official FAO data, identify areas where data might be missing or misrepresented and consult both existing literature and local experts and agencies to compile more accurate data. This is a method known as “catch reconstruction,” and the researchers used it to examine all catches between 1950 and 2010. Ultimately, they estimated that global catches during this time period were 50% higher than the FAO reported, peaking in the mid-1990s at 130 million metric tons, rather than the officially reported 86 million. As of 2010, the reconstructed data suggest that global catches amount to nearly 109 million metric tons, while the official data only report 77 million metric tons.

A comedy that captures Italians’ love for il posto fisso – a job for life – has become an unlikely blockbuster hit in Italy. Quo Vado? – or Where Am I Going? – is close to overtaking Avatar as the highest-grossing film in Italian box office history, having generated €59m since its opening on New Year’s Day and beaten international rivals such as Star Wars: The Force Awakens. Even Matteo Renzi, the energetic Italian prime minister, is said to have seen the film with his children. He told one newspaper that he laughed “from the beginning to the end”. The success of Quo Vado? reflects a relatively recent change in Italy: the cushy public sector jobs promising steady income and great benefits that were a staple of the country’s economic engine are now considered a thing of the past.

In their place has come high unemployment – which, while improving, is still at 11.3% – and job insecurity, which has hit young workers particularly hard. Alessandro Giuggioli, a film-maker who produced an independent film, In Bici Senza Sella (On a Bike Without a Saddle), about precarious jobs, said the posto fisso was like the holy grail in Italy: “You know it is a possibility and that you are never going to reach it.” While his parents’ generation enjoyed lifelong job security, Giuggioli said young people in Italy today had to make do with rolling short-term contracts, which have become the new normal. He partly blames Italy’s tax system and bureaucracy. “If an employer wants to hire you for €1,000 (£770) a month, they end up paying €2,500 a month. It’s crazy. And so they hire you for three months instead, paying €600,” he said.

The European Union’s top official warned Tuesday the bloc has just two months to get its migration strategy in order amid criticism that its current policies are putting thousands of people in danger and creating more business for smugglers. “We have no more than two months to get things under control,” European Council President Donald Tusk told EU lawmakers, warning that a summit of EU leaders in Brussels on March 17-18 “will be the last moment to see if our strategy works.” The EU spent most of 2015 devising policies to cope with the arrival of more than 1 million people fleeing conflict or poverty but few are having a real impact. A refugee sharing plan launched in September has barely got off the ground and countries are still not sending back people who don’t qualify for asylum.

A package of sweeteners earmarked for Turkey – including €3 billion, easier visa access for Turkish citizens and fast-tracking of the country’s EU membership process – has borne little fruit. The failure has raised tensions between neighbors, particularly along the Balkan route used by migrants arriving in Greece to reach their preferred destinations like Germany or Sweden further north. Tusk warned that if Europe fails to make the strategy work “we will face grave consequences such as the collapse of Schengen,” the 26-nation passport-free travel zone.

Farmers’ roadblocks, ferries immobilised in ports, pensioners taking to the streets: protest has returned to Greece in what many fear could be the beginning of the crisis-plagued country’s most confrontational winter yet. From the Greek-Bulgarian frontier to the southern island of Crete, farmers are up in arms over the spectre of more internationally mandated austerity. “It’s war,” says Dimitris Vergos, a corn grower speaking from the northern town of Naoussa. “If they [politicians] go on pushing us to the edge, if they want to dehumanise us further, we will come to Athens and burn them all.” With the rhetoric at such levels, prime minister Alexis Tsipras’s leftist-led administration has suddenly found itself on the defensive. Faced with a series of demonstrations – fishermen and stockbreeders will join blockades on Thursday when public and private sector workers also take to the streets – analysts say any honeymoon period Tsipras may once have enjoyed is over.

On Wednesday, convoys of tractors in Thessaly, the nation’s breadbasket, blocked the road at Tempi, effectively cutting the country’s main north-south highway. Hundreds more lined the seafront in Thessaloniki while, further north, police were forced to fire rounds of tear gas at protestors barricading Evangelos Apostolou, the agriculture minister, in an administrative building as fierce clashes erupted in Komotini. The focus of their fury was proposed pension and tax measures, the latest in a battery of reforms set as the price of the debt-stricken nation receiving a third, €86bn, bailout last summer. For farmers, the draft policies are tantamount to the kiss of death. “We are going for all out confrontation,” said the prominent unionist Yannis Vangos, warning that by Friday roadblocks would be erected across a large swath of the county.

“It seems we can’t see eye to eye at all. Things are out of control. It’s not just one thing we have to negotiate.” Six years into Athens’ economic crisis, even more Greeks claim they have been pushed to the point where they can no longer survive the rigours of austerity. With an unprecedented 1.2 million people unemployed – more than 25% of the population – many have been pauperised by the biting effects of keeping bankruptcy at bay. Pensioners, whose incomes have been reduced 12 times at the behest of the EU and IMF, this week also upped the ante taking to the streets. Creditors argue that at 17% of GDP, Greece’s pension system is Europe’s costliest and to great degree the generator of its fiscal dysfunction. But those who stand to be affected by the overhaul counter the changes go too far. For farmers, the reforms will not only raise social security contributions from 6.5% to 27%, but double income tax payments from 13% to 26%, eradicating more than three quarters of their annual earnings.

The IMF abolished Wednesday a rule created in 2010 that allowed it to participate in an international bailout of Greece despite doubts about the country’s debt sustainability. “Today the executive board of the IMF approved an important reform to the Fund’s exceptional access lending framework, including the removal of the systemic exemption,” IMF spokesman Gerry Rice said in a brief statement. The “systemic exemption” amounted to a loophole in the IMF’s longstanding policy that required the crisis lender to judge a member country’s public debt to be sustainable with “high probability” before it could provide financial assistance that exceeds a member’s contribution to the institution.

Reeling from budget and banking crises in 2010, deeply indebted Greece did not meet the sustainability condition and the IMF decided that a debt restructuring could pose severe negative spillovers on the rest of the eurozone. The IMF thus created the “systemic exemption” provision which paved the way for it to join the EU and the ECB in the so-called “troika” of international lenders throwing a lifeline to Greece. For the IMF, that amounted to 30 billion euros ($32.7 billion) in May 2010, then an additional 18 billion euros in a second bailout two years later. The systemic exemption was used more than 30 times to permit loan payments to Greece but also for Ireland and Portugal, two other eurozone members receiving assistance from the troika, by end-May 2014.

Its use, nevertheless, has stirred criticism, notably from some emerging-market countries that saw it as giving favorable treatment to European states in response to pressure from Western powers. With the elimination of the loophole, the IMF is seeking to close a controversial chapter in its recent history as it decides whether to join the EU and ECB in a third bailout of Greece launched last August. In a sign that the abolition of this “systemic exemption” was already effectively in place, the IMF is demanding this time, before unblocking any new loans, that the Europeans first agree to ease Greece’s debt burden to ensure its sustainability.

Some 350 refugees and migrants, including many children, had gathered by Wednesday night in freezing conditions near Idomeni on Greece’s border with the Former Yugoslav Republic of Macedonia (FYROM) after the latter closed its borders. Greek officials said that the border has been closed since Tuesday night, leaving dozens of people unable to cross into FYROM and continue their journeys to Central and Northern Europe. Seven coaches full of refugees and migrants that had traveled north from Greece’s Aegean islands arrived at the border on Wednesday, prompting the government to allow the camp in Idomeni that had been constructed by nongovernmental organizations during the summer to be used to provide shelter and medical assistance to the migrants. Over the last few weeks, officials had refused to allow the camp to be used due to fears that hundreds of people would start gathering at the border again. The cold weather has also made conditions difficult on the islands.

Two refugees – one a 5-year-old child – died from hypothermia on Lesvos on Wednesday. The child died after the dinghy it was traveling in capsized off the island. It was taken to a medical center on Lesvos but doctors were unable to save its life. The coast guard rescued 46 people. The other person who died was a woman who reached the island safely but succumbed to the subzero temperature. Authorities said that despite the worsening weather, about 1,000 people arrived on Lesvos on Tuesday and another 1,000 reached the island on Wednesday.